April 24, 2015
by Bobby Casey
There has been a lot of drama in the news over the past few months surrounding billionaires and multimillionaires who have stashed cash offshore to avert taxes or legal issues back home.
The fourth branch of the American government, also known as “mainstream media” has been on a rampage attacking offshore centers like Cook Islands, Nevis, Belize, BVI and more – claiming these evil monsters, known as job creators, are hiding from the government and not paying their fair share.
The Obamessiah administration seems hellbent on going after these evil tax-dodgers and legal cheats.
The irony of it all is that the good ole US of A is the largest tax haven in the world.
Let me explain…
Through our offshore corporate services division, when we register an offshore company for a client, we must get all pertinent information about that client:
- copy of passport, notarized
- copy of utility bill, notarized
- copy of 2nd id, notarized
However, through our domestic corporate services division, we can register a company with nothing but your disclosed name. I don’t legally need to collect any of this data.
I don’t even need your phone number or email address. As long as you pay us for the service, we can register a company for you in Wyoming, New Mexico, Nevada and others without any need whatsoever to collect this data.
What does this mean?
If you are a non-US citizen or resident, you can call me on the phone and have me register a Wyoming LLC for you completely privately.
You can take that Wyoming LLC and buy real estate, private investments, or even open a brokerage account.
Of course when opening financial accounts, the service provider (brokerage firm, bank, etc) will require documentation on the Wyoming LLC’s beneficial ownership, but the legal owner as a matter of public record remains the Wyoming LLC.
For the past 100 years this has created a huge influx of investment into America. Foreigners can invest privately and with no negative legal recourse for failed investments.
EXACTLY AS LEGISLATORS PLANNED
You see, this is one of the strategies that has given America an edge. It has provided huge incentives for foreigners to invest but allowing them to remain anonymous and in the shadows.
However, it doesn’t work both ways.
Legislators in the US have pursued American investment abroad with a tremendous amount of vigor. They want their piece of the pie.
They are content to allow foreigners to come and bring cash to the land of the free to boost FDI (foreign direct investment), but not so keen on watching Americans take their earnings abroad seeking greener investment pastures.
FATCA (foreign account tax compliance act) in my opinion is a last ditch effort to try to plug the holes in a sinking ship. Ultimately it will have the exactly opposite effect of the desired outcome.
In our globalized and technology driven economy, the world has become a much smaller place. We can relatively cheaply get on a plane to visit clients or partners in Hong Kong or even schedule a webinar to “meet” face-to-face through video.
Rates for international calling are so low, it eliminates the cost barrier to connect globally. Of course there are also now free options using various forms of VOIP (voice over internet protocol) phones.
I no longer need to pay huge courier fees to send signed documents around the world. Nowadays I can digitally sign a document using pdf software and email it, for free, to my client or partner.
Gone are the days where daily or weekly staff and boardroom meetings are the norm. We can schedule video chats and conference calls for pennies on the dollar, or even free.
We no longer need huge file cabinets to store documents or server rooms for our bank of servers and phone system equipment. Now we host our data storage in the cloud and use cloud based servers and phone systems.
These trends aren’t reversing and they have changed our daily lives forever.
These trends have also forced countries to compete for business and investment on a global scale. Trailing along on near last place in that competition is the good ole US of A.
The US has the most complex regulatory regime and the highest corporate tax rate (39.6%) in the world. It’s like legislators are intentionally trying to drive away business and investment.
While the OECD countries median corporate tax rate hovers around 25.5%, or about 36% lower than in the US.
Now clearly this doesn’t paint a full picture and there are many variables to consider. But the point is that the US is falling behind on competitiveness.
This is why the US remains, and likely will remain for a long time – the World’s Largest Tax Haven.
The US really has no choice. Until regulators get some semblance of common sense and drop their own “America is Better” arrogance, it will remain uncompetitive domestically leaving legislators with the necessary option of retaining the throne of World’s Largest Tax Haven.
From my perspective, for Americans the time is now to get some of your investments and/or business interests outside the US. The odds are not stacked in your favor domestically. The odds are heavily tilted toward foreigners investing in the US.
Americans need to seriously consider an international investment strategy. And sooner rather than later.
For non-American citizen or residents, you may want to consider American structures and investments. It gives you a level of privacy you cannot get even in traditional offshore centers, plus there are enormous incentives for you to invest tax efficiently in the US.
For our GWP Insiders members we will be offering monthly webinars to discuss various strategies to internationalize your wealth. These will be live and real time so you can join in the discussion and get your questions answered. They will also be recorded for future viewing for GWP Insiders members. If you are interested, click here to join now.
Our first scheduled webinar will be hosted in May – “Become an Offshore Real Estate Mogul….and Live for FREE”. We will discuss how to live as a global citizen rent free and get paid for it.
Until next time, live well