Hong Kong Next Target of USA for Tax Evasion



Posted: Monday, November 16, 2009

by Aurelia Masterson
Panama Legal

Executive Summary – The USA is announcing that Hong Kong is their next target for tax evasion. This comes on the tail of their success in Switzerland. This story was just carried by Bloomberg and has no statements from the government of Hong Kong, nor does it have any court filings etc, Could be a trumped up nothing or it could be real?

The USA did announce that it is going to open an IRS office in Hong Kong. It never said it has such an office already. It appears that after the Switzerland scandal the IRS got 7500 voluntary immunity candidates. These were banking all over the world. Some of these apparently were using Hong Kong and this spurred the IRS on to "want" to go after Hong Kong in their quest for tax evaders, as they call them. The voluntary disclosure filings required the details of the financial advisor being used and how the structures were formed.

Hong Kong Financial Professionals – The IRS seems interested in the role that Hong Kong financial professionals played in assisting USA people to shelter their assets in Hong Kong. It appears they want to drop hard on some financial professionals there to get a good scandal going. Then they beat the war drum loud enough to get into the banking records of the banks they entangle in the scandal. All during this the US will be printing worthless paper money as part of the largest Ponzi scheme in the history of mankind called the Federal Reserve.

Implications – We are watching this one carefully. We have yet to see one tax treaty signed by Hong Kong. It is pointless to listen to the chest beating of the IRS without any signed tax information sharing agreements. Those using Hong Kong should exercise extreme caution in case tax treaties start to get signed. Hong Kong passing laws, issuing rulings etc is just noise, it is the tax information sharing agreements that do the damage by letting the foreign governments have the banking records and these have not been signed by Hong Kong. The USA would of course like to pressure the Hong Kong banks to not accept any USA citizens and if they have any to send them away closing their accounts. If tax treaties begin to be signed the solution would be to close the account before the enactment date of the tax treaty so your old closed account would still be covered by the old bank secrecy.

Safe Tax Haven – Ecuador seems to be the safe tax haven for now. Ecuador announced they would not sign any tax treaties. They declared money-laundering laws to be unconstitutional and never had a money laundering conviction. They do not tax offshore-derived income. They have anonymous corporations and bank secrecy. They are currently a dollarized economy but are in the process of shifting to a basket of currencies to replace the dollar. Inquire if interested.

http://www.panamalaw.org


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