Why hiding money

The worst is that some of this money comes from developing countries, which have a desperate need for it. A great deal has been done in recent years to tackle the issue of tax havens.

For those who want to hide money, there are several ways to make sure that their assets find their way to a tax haven with little or no tax. Trusts are one widespread way to achieve this goal.

Trusts can be used for tax planning when a person transfers their wealth to a trust, which then can be used to benefit the same person or the person's family. If the trust is established in a tax haven, the person in question is then often no longer the legal owner of the property and is not liable to tax on the return, but will nevertheless be able to benefit from it.

The value of the trust is often managed by someone who works at a law firm in the tax haven. The trustees ensure that those who are listed in the trust receive money. According to Schjelderup, most large multinational companies in the world have what is called a holding company in a tax haven. These holding companies own companies in other countries.

Patents and brand names are difficult to place a value on. This is how a lot of profits are transferred to tax havens. The holding company thus becomes a piggy bank for shareholders and is used for global tax planning by multinational companies such as Apple, Starbucks and Google.

Some defenders of tax havens argue that they have value because they can prevent double taxation, or paying tax on the same income in two countries.

Schjelderup discusses this in an article in the national newspaper VG here in Norwegian. The British Virgin Islands have just 31, inhabitants, but there were a total of , companies registered in the islands in On average, each inhabitant had 27 senior executive positions in foreign companies.

The corresponding figure for Norway in the same year was 0. How much management work are they actually able to do in the British Virgin Islands? Good Subscriber Account active since Shortcuts. Account icon An icon in the shape of a person's head and shoulders. It often indicates a user profile. Log out.

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