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At the G20 meeting the OECD named Costa Rica on its blacklist of non cooperative tax havens
Any ideas what the santions would be and when/if they would startIt’s hard not to raise a smile when a group of non-elected countries form a club (OECD) and plan what is best for the rest of the world – then claim to be promoting something called “democracy” 🙂
Costa Rica is not exactly a “tax haven” in the true sense. The view taken by OECD is that any country with little or no tax regime or the inability/lack of transparency to cooperate with “civilized world” in the exchange of tax information is a “tax haven”.
When the CR immigration department is drowning in work and where basic utilities can be erratic, maybe there are higher priorities relating to basic infrastructure to resolve before fussing over OECD pontifications?
Who knows amccarty, but suspect the Costa Rica government will put a framework in place to say they are in compliance with the OECD club without reaching that boring old threat of “sanctions”. Costa Rica is not a country which relies on an offshore services industry to support it’s economy – unlike “real” offshore jurisdictions (tho most of them are already complying anyway).
I would like to suggest to the OECD that they consider sanctioning the following states in the USA who do not charge a state income tax:
Alaska, Florida, Nevada, South Dakota, Texas, Washington, and Wyoming. (New Hampshire and Tennessee limit their state income taxes to dividends and interest income only.)
I think they should all pay the same 10.3% state income tax that they pay in California. However – and I’m only guessing here – the people in Alaska, Florida, Nevada, South Dakota, Texas, Washington, Wyoming, New Hampshire and Tennessee might have some objections – What do you think?
The OECD is the ‘Organisation for Economic Co-operation and Development.’ You can see a short video ‘about the OECD’ at
[ http://www.oecd.org/pages/0,3417,en_36734052_36734103_1_1_1_1_1,00.html ]The mission for these overfed, overpaid EuroBureauCretins is:
“OECD brings together the governments of countries committed to democracy and the market economy from around the world to:
• Support sustainable economic growth
• Boost employment
• Raise living standards
• Maintain financial stability
• Assist other countries’ economic development
• Contribute to growth in world tradeObviously the OECD is failing in their mission quite magnificently on all counts.
Angel Gurria is the Secretary-General of the OECD and on the video states that: “The OECD is a problem solving organization…. for a better world economy.”
Once again, they have proven to be totally useless in their efforts to solve problems “for a better world economy.”
Question: Why should all countries have a standard taxation system?
I am not referring to Costa Rica here but if a country can manage it’s economy well and doesn’t need high taxes, why should they not be allowed to charge lower taxes or no taxes? Which in turn, encourages more investments within that country.
You can see a list of possible OECD sanctions that might be take against at
[ http://www.taxresearch.org.uk/Blog/2009/03/10/the-oecds-tax-haven-sanctions/
]Scott Oliver – Founder
WeLoveCostaRica.comPS. One of the most serious problems that could arise with sanctions is the ability to access the US banking system… Needless to say that would affect a lot of people and a lot of business…
Maybe we could adopt the Chinese Yuan as our currency instead? A million dollar home would only be 6,834,790 Chinese Yuan
Question: Why should all countries have a standard taxation system?
Why do you ask sane hard questions? 🙂 It’s too difficult to answer unless speaking for an OECD member government, but first benefit is that it creates employment in having tax offices staffed to shuffle paper.
For some nations it does not make sense to implement a “standard taxation system”. The cost can be much higher than any incoming tax revenue and can drain resources away from higher priorities. Other examples are where taxation is levied on import duties and at points of sale (in effect Sales Tax or VAT) – much more efficient!
BTW.. you may remember the introduction of VAT in the UK, early 70’s? Claims were made then that VAT would replace “standard taxation”. Almost 40 years later, the UK is still waiting for this simplified taxation system – obviously this just slipped the memory of the UK representative at the OCED.
Ah! Yes! VAT which means ‘Valued Added Tax’ except only on rare occasion is something of value actually added, it’s a wonderful world eh?
And is there really a problem with these good folks black listing Costa Rica…. declining to become part of the new world order that seeks to track every dollar law abiding citizens spend? Let them do their thing…. perhaps they should instead spend some time figuring out where the 8 TRILLION dollars went that the banks and the US government has made disappear in the last 6 months!
Hallelujah! Imxploring
The amount of $$ lost to tax “evasion” by citizens or businesses is a petty cash compared to what our governments L-O-S-E every year….
Scott
Imxploring. As usual, you are top of your game.
Some economists are predicting that the Obamarxist takeover of the US economy (with its inevitable stagflation catastrophe) as well as the increased taxation of wealthy US citizens will become a major stimulus for many folks to move themselves and their assets offshore.
I would imagine that politically stable Costa Rica, with it’s OECD blacklist status appeals to intelligent folks who intend to keep as much of their their hard earned money as possible.You can read about Obama’s new tax proposals in the following publications:
Obama seeks tax hike, higher Medicare payments
http://www.cnn.com/2009/POLITICS/02/25/budget.healthcareObama to propose raising taxes on wealthy for health-care fund
http://www.mcclatchydc.com/politics/story/62855.htmlObama Tax Raise: Looks To Raise Taxes On The Affluent To Pay For Health Care
http://www.huffingtonpost.com/2009/02/26/to-pay-for-health-care-ob_n_170129.htmlThe battle between the rich and the government has already begun. I’m sure you’ve noticed the global crackdown on private, offshore banking in places like Switzerland and Liechtenstein. But you probably don’t know about the Heroes Act of 2008.
On June 17, 2008, then-President Bush signed the bill into law. The main purpose of the bill was to provide benefits and more financial flexibility for military families. But… also stuck in the bill was new legislation requiring full estate taxes to be paid on the worldwide assets of any citizen voluntarily giving up U.S. citizenship.
In other words, you can leave the country if you want, but you can only take about half of your assets with you. (You can read a review of the new law here:
http://www.watsonwyatt.com/us/pubs/insider/showarticle.asp?ArticleID=19244.)
H/T Porter Stansberry
Those who decide to liquidate their US based assets will have to be more creative as to how to move their funds to a safe haven. Costa Rica being on the blacklist of non cooperative tax havens is in the favor of those who intend on keeping their hard earned money. However, opportunities do not last forever and the democrats are closing in on the banking industry. Get out while you still can…
Not only are the Feds going to doing it… my home state of NY has already gone and added additional higher tax rates for high income earners to the “new” state budget. In addition to adding tons of new “fees” that they’ll pass off as non-tax revenue streams! It’s getting bad, and those smart enough to see the writing on the wall know it!
Government now hits you from so many alternate angles for revenue that raising “taxes” isn’t even the real issue anymore! They still can stand in front of a crowd at election time touting that they didn’t raise taxes… in the meanwhile every facet of your daily life will be impacted by some type of “fee” that drains your wallet!
When I’ve joked about bartering and investing in tuna in the future… it wasn’t far from the reality I see coming very soon! In the next few months hundreds of thousands (yes that is correct) of folks will exhaust their unemployment benefits… even after all the extensions… and will have NO income in an economy that’s not generating jobs… and it’s going to get only worse!
My plan was quite simple…. leverage everything in the US and purchase assets off shore which I own outright… no complex banking, no paper trail, no hiding cash in a bank somewhere… leave the debts in the states… and hold the free and clear assets somewhere that they respect one’s right to own something for which they don’t have to pay an unreasonable fee to keep! While Uncle Sam believes he has the right to tax you on your money to any degree he wishes… he hasn’t yet figured out a way to tax you on real estate you own in another country… it’s all quite simple and completely legal… and a plan that I’m quite comfortable with.
As for the tax/banking issue… Costa Rica should be quite proud of being black listed and respecting the rights of folks to defend themselves from a US government gone on a crack binge! Because much like a crackhead… they’ll do anything to keep it going… no matter who they hurt or how many bad choices they make!
Edited on Apr 05, 2009 21:30
As Washington resident I have an objection Scott. Our sales tax just went up another .5% to 10.1% in Seattle. As a busines owner we also have B&O taxes, unemployment and workers’ compensation = 14% of payroll. Every town you work in has a license and myriad of permits. To build a home you ae looking at 10% in permit & mitigation fees. Every time you buy a car you pay the sales tax; if it is brought from another state, you pay an excise tax = sales tax. Same with a used car. If you sell your home you pay 1.7% excise tax. Property tax is 1.7% of value every year. There is taxation at every turn; income tax is just piling it on with no equitable relief elewhere.
The Haves and the Have-Nots are at odds these days. The governments, for the first time, are moving to the defense of the the Have-Nots and the infrastructure and now I read advice which recommends taking the money and running before you are forced to pay your fair shares for the salvaging of the economies from which the wealth was extracted. The light has been turned on and now the roaches scurry for the dark corners, complaining all the way that there are fewer places to hide their loot.
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