Comments on: Panama and the OECD

By: JasonM

JasonM — Sun, 01 Nov 2009 05:54:53 +0000

While it is somewhat reassuring to read the note by Jassyca, but the wider implicaitons of the actions of OECD are only too serious to ignore.

Who would have imagined 3 years ago that Switzerland would open its Bank records ot the IRS? Talk about what pressure does to a country. Austria and Singapore (yeah, as of Oct 31, 2009) have followed suit in signing a tax informaiton exchange agreement with Western Jurisdictions. The question is: where is it leading to? And will this trend of free for all tax report exchange change? Bottom line: now no person is enthusiastic about opening up an offshore account which is what the IRS wanted.

US will keep up its pressure on non compliant or semi-compliant jurisdictions of course. But if the dollar is no longer the currency of the world, the clout of the US will fall and so will the clout of OECD. That will be the change of the previous world order.

By: Jessyca Angulo

Jessyca Angulo — Mon, 05 Oct 2009 16:45:41 +0000

I am a Panamanian lawyer, and I have followed the OECD issue for several years now. This issue is nothing new for Panama, and the OECD has been pressuring all tax havens to give up their bank secrecy laws and to implement tax laws that create a so-called “level playing field” from a fiscalization standpoint. All of the past four Presidents (Perez-Balladares, Mireya, Torrijos, and now Martinelli) in Panama have made significant changes to our local tax legislation, which have converted our country into a relatively heavily taxed jurisdiction for locals or for operating business in Panama, making Panama a NON-TAX HAVEN for doing business within the territory of Panama. However, Panama has maintained its’ territorial tax system (Panamanian citizens and corporations are only taxed on income generated within the Panamanian territory, not on income generated from outside of Panama), as well as maintained its’ bank secrecy laws. The Martinelli administration is currently working on signing “double-taxation treaties” with other countries such as Mexico, Spain, etc. which will benefit our country by enabling investors from those countries to invest without double taxation, however, our bank secrecy laws should not be affected. Currently, bank secrecy is not lifted except for in criminal cases, and the Panamanian law clearly establishes the extensive legal procedures that foreign courts / authorities must go through to obtain banking information for cases involving criminal activities.

By: Roberto

Roberto — Sun, 04 Oct 2009 11:15:39 +0000

cool blog

By: Steve Loy

Steve Loy — Tue, 29 Sep 2009 02:42:16 +0000

Hi Simon:
Thanks for the honesty, but to say the least I am vastly disappointed. Martinelli as a Graduate of Texas A&M should know all of the strong arm tactics of the US and how to beat them. This just raises a huge red flag for me. After reading your “What Capital Controls will look like” I can tell you that capital controls will hit all of the OECD reporting countries. As a US citizen we will lose all of our capital when the US decides they need it. Your strategy for protecting what we have earned is gone. Even if you own real estate, the US Gov will just take your cash in the US or OECD bank to cover the confiscation of the real estate, and who knows what price that will become. It looks like to me the only safe haven in the world is Monaco, since they have not sucked up to the OECD yet. However, Monaco is reserved for the ULTRA RICH only.
Thanks Steve

By: offshore biz

offshore biz — Tue, 29 Sep 2009 01:44:58 +0000

I’m looking forward to hearing about the future “most free” jurisdiction that Simon scoped out on his Asia trip. However, I agree that privacy from taxing authorities is disappearing. It didn’t matter as much for myself as I am a US citizen, and had to report foreign bank accounts anyway. But I do appreciate the estate planning, asset protection from frivolous lawsuits, and better choices of banking afforded by offshore jurisdictions. And of course, there are the reporting exemptions for foreign real estate holdings, segregated metals storage, etc, for US persons.

As I contemplate where to invest my company’s funds, in the US, or offshore, I cringe when I think of the possibility of currency controls for the US. Almost all of the business I do is outside the country. And it sounds like many folks in this forum are looking to connect with small businesses and investment opportunities around the globe as well. The internet has been a fantastic means to do initial exploratory work, and boots on the ground takes it the rest of the way. I hope our country, purportedly the bastion of free enterprise, doesn’t cut off our entrepreneurs and investors in foreign enterprises at the knees.

Thanks Simon, for keeping the guardian’s eye on the evolving world situation. This forum provides valuable perspectives from both yourself and your forum members.

By: Doug

Doug — Tue, 29 Sep 2009 01:18:35 +0000

Hi Simon. I thought that Panama’s major Achilles heel was its financial vulnerability to pressure from the US, so it is no surprise that it will capitulate on account disclosures.

Beyond Panama, I am now thinking that these foreign banks and countries have now set precedence in crumbling under OECD (ie US) pressure. I predict that they will also fall under the next set of pressures and will agree to repatriate US client funds when the capital export controls are enacted. Let’s see if I am right……

By: A reader

A reader — Mon, 28 Sep 2009 22:43:04 +0000

Hello, Simon,

While the OECD is the frontman for the anti-tax haven crowd, if anyone looks behind the curtain they will find that the instigator is the United States of America. The hypocritical swine! No one tells you that the United States of American is the largest tax haven for foreigners. Shhh, don’t tell the locals.

There is a legitimate and practical reason for so-called tax havens that NO anti-tax haven government understands, or at least acknowledges. That is to say, people the world over want to keep what they earn. It is the extortion by ALL governments that the people are trying to protect themselves against.

But the United States of America is the culprit behind the scenes, along with the other skullduggery around the world. You can put your tax haven money on it.

Hopefully, after the demise of the dollar and with the creation of a new medium of reserve exchange, the United States of American will lost its power to bully the world.

By: Steve

Steve — Mon, 28 Sep 2009 22:08:41 +0000

Panama seems like a very libertarian and free place. I haven’t been there, but that’s my impression from what i’ve read. But, what about the fact that Bush number 1 shot up the place and deposed Noriega. It makes me wonder if Panama is really independent of the CIA and the US – in which case the US could re-assert whatever level of control it wanted at any given time. And from what i’ve observed the private banking cartel (FED reserve)/CIA/Pentagon that run the US gov aren’t quite libertarians.

By: Brian

Brian — Mon, 28 Sep 2009 21:20:14 +0000

Simon,
What about having bank accounts in Cuba, Libya or Venezuela to ensure privacy from the government tax collectors? In these jurisdictions, the question might arise as to the safety (or even return) of one’s funds, but I thought I would throw out the thought anyway. Without question, it is the duty of every citizen to avoid paying taxes as much as possible, and much more importantly, I believe it is the duty to evade taxes, to put pressure on governments to downsize.(just kidding, IRS) Reducing blood flow to our masters is essential. (not joking) One more thought: Where could we begin anew? A new country without taxation, with full liberties, near 100% privacy, and totally business friendly. Would that not be successful in every sense?

By: c wilson

c wilson — Mon, 28 Sep 2009 18:00:24 +0000

As to offshore accounts…. if one were to own shares in an offshore company, yet NOT sign on any of the banking (with the assumption the facilitator/local partner is 100% trustworthy) there would be no reporting required to the IRS. Yes? I find this absolute best avenue accomplishing the safety and secrecy you so desperately and wisely seek.