USA Biggest Tax Haven In The World Now. Tax Avoidance Money Along With Flight To Safety Reasons For Market Increase? Legal Changes Coming?
Foreigners have been ” evading ” taxes using the USA entities to buy assets anonymously with LLCs and shell corporations. Many articles, especially from Bloomberg, have been touting ( with detailed proof) the USA as the biggest tax haven in the world now.
How much money are we talking about that’s globally out there ” avoiding or lowering taxes” ?
“A 2012 report by the British Tax Justice Network estimated that between US$21 trillion and $32 trillion is sheltered from taxes in unreported tax havens worldwide. If such wealth earns 3% annually and such capital gains were taxed at 30%, it would generate between $190 billion and $280 billion in tax revenues, more than any other tax shelter”. ( Wikipedia )
These amounts do not include just money being deposited and invested in the USA from foreigners just for safety and a positive rate of return.
Just look at the utility index up 20% this year, way outperforming the regular indices. This we think has never happened before. Look at the price appreciation of the REITS compared to the general market.
We think this fact, along with the premise that the USA is the safest place in the world for foreigners to invest and keep their money; especially with numerous major countries now with negative rates of return i.e. Germany. Japan etc. is a seriously viable factor in why the stock market has performed well and continues to even though the market at this time we believe is fully valued.
In talking with some highly connected and intelligent friends, they tell me there is a change now or imminent where now a foreigner can no longer remain anonymous for this tax avoidance scheme that do not identify them in the USA or abroad for amounts more than $3 million USD.
Here below is a bill in congress that seems to coincide with what I’ve been told. More checking being done.
With the amounts of money ( tens of trillions) in just the tax avoidance schemes alone mentioned above, where a good amount of it could have been invested, and we think has surely been, in the USA, along with the Just the investing here for safety aspect due to global concerns, we think it’s especially important to dig deeper into this to see if and when it would really end.
It could certainly have a deleterious effect on the markets if there are negative changes made or other events transpire.
Nothing lasts forever.
Here is the link to a new tax reporting change bill.
It’s definitely worth checking more into it. Fred Lange and I mentioned this months ago as occurring and we have not seen much if not no mention of it on any of the media in any real or important way since then. Maybe a few semi mentions on the foreign money being invested for yields and returns. But nothing relating to these figures or any real details.