Who owns the Wealth in Tax Havens?
WHO OWNS THE WEALTH IN TAX HAVENS?, an NBER working paper, points to following the money:
Drawing on newly published macroeconomic statistics, this paper estimates the amount of household wealth owned by each country in offshore tax havens. The equivalent of 10% of world GDP is held in tax havens globally, but this average masks a great deal of heterogeneity—from a few percent of GDP in Scandinavia, to about 15% in Continental Europe, and 60% in Gulf countries and some Latin American economies. We use these estimates to construct revised seriesof top wealth shares in ten countries, which account for close to half of world GDP. Because offshore wealth is very concentrated at the top, accounting for it increases the top 0.01% wealth share substantially in Europe, even in countries that do not use tax havens extensively. It has considerable effects in Russia, where the vast majority of wealth at the top is held offshore. These results highlight the importance of looking beyond tax and survey data to study wealth accumulation among the very rich in a globalized world.
Um, most of your audience is probably in the U.S. What’s the U.S. percentage?
The paper says a lot of the money held in the Caymans in US Corporate monies. This is profits made overseas, taxed, and then held offshore to avoid the 35% US repatriation taxes. This is the super low hanging fruit Trump wants to harvest with his tax cut/holiday which allows this money to come flowing back into the US to be reinvested etc.
After all, nothing is coming back at 35% tax, so why not go for it.
Follow the money from 2005 repatriation….buyback stocks, dividends, not so much re-investment you claim.
Not to mention he is assuming that would be be the tax rate on the corp bringing back that income.
He seems to do a lot of that on a myriad of subjects, and somehow they all seem like the same assumptions of the heritages of the world.
This is yet another down side of low corporate and individual tax rates. When it doesn’t cost much to take money out of corporate operations and investment, that’s what happens. When taxes are high, paying higher wages and investing in the future makes sense. You’d only see 10% of the money anyway. When taxes are low, cutting wages and liquidating the company mean more money for the wealthy sitting idle. We used to know this. Higher taxes actually make tax shelters less attractive.