Monday, August 15, 2016

What the Dirty Lying Commies are Saying About the Cayman Islands

Question: When does a law against tax cheating become a huge loophole that legalizes giant corporate tax avoidance?

Answer: When a capitalist government is involved.

Does that seem a tad cynical? Well, consider this.

For decades big businesses and rich individuals have been hiding their ‘earnings’ in overseas tax havens and dummy corporations. As a result, the Canada Revenue Agency has been deprived of billions of dollars of tax revenue – and that becomes a convenient government argument for cutting social and infrastructure spending, for freezing public sector workers’ wages, slashing pensions, and reducing work place health, safety, and environmental protection.

In 2010, Ottawa joined an initiative of the Organization of Economic Co-operation and Development to force tax havens to be more transparent. They started signing Tax Information Exchange Agreements (TIEAs) with notorious tax havens such as the Cayman Islands, Jersey, the Isle of Man and the British Virgin Islands, where tax rates are close to zero.

But at the same time, Ottawa’s tax code was altered to allow any Canadian multi-national corporation doing business in a TIEA partner country to bring profits home tax-free. American multinationals have to pay tax when they repatriate international profits. But, in Canada, the TIEAs mean that profits can be declared in a tax haven, where there is little or no tax, and brought back without paying a penny more.  (more...)


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