By William Winter/OtherWords
There are many ways in which the United States is not one country.
I’m not referring to red states versus blue states, or racial or ethnic divisions. What I mean is that the United States, where countless corrupt billionaires and dictators have stashed their loot, is not a single tax haven, but many separate tax havens.
The Pandora Papers, released in October, show that the United States is second only to the Cayman Islands in facilitating illicit financial flows. But it’s not a simple picture.
Each state and territory has its own laws and regulations about financial transactions used for tax evasion or money laundering. And both red states and blue states are destinations for those who seek to hide their money from tax collectors and public scrutiny.
President Biden’s home state of Delaware has long been renowned for its use as a tax haven, beginning in the late 19th century. Reliably Democratic in national politics, Delaware still ranks at the top among U.S. states providing secrecy for corporations and ultra-high-wealth individuals, both domestic and foreign.
But the Pandora Papers cite ruby-red South Dakota as an attractive destination for billionaires and others seeking to avoid estate taxes.
The International Consortium of Investigative Journalists (ICIJ), which led the Pandora Papers investigation, obtained access to the records of the Sioux Falls office of Trident Trust. Among its clients were the family of Carlos Morales Troncoso, former president of Central Romana, the largest sugar plantation in the Dominican Republic – which is notorious for its exploitation of Haitian workers.
South Dakota led the way in providing such trusts, as reported in detail even before the current revelations. But other states, including Alaska, Florida, Delaware, Texas, and Nevada, have followed suit.
The Pandora Papers also document the luxury real estate holdings of Jordan’s King Abdullah. Like many other politicians and oligarchs around the world, King Abdullah owns real estate in many places outside his country. The ICIJ found records of his purchases in London and Washington, D.C., among other cities, as well as three side-by-side mansions in a luxury enclave in Malibu, California.
Bottom line: Those seeking to track down the hidden wealth that dictators, criminals, or jet-setting billionaires have lodged in the United States must not limit their efforts to supporting changes in national legislation in Washington, D.C. They must also turn the spotlight on state and local communities around the country.
In February 2017, for example, the Washington Post called attention to the fact that U.S. relations with Gambia and Equatorial Guinea were not just “foreign policy” but also a local story in Potomac, Maryland.
Ousted Gambian dictator Yahya Jammeh lived at 9908 Bentcross Drive in the D.C. suburb. His counterpart Teodoro Obiang Nguema, who has ruled Equatorial Guinea since his successful coup in 1979, still owns the house at nearby 9909 Bentcross Drive.
The effects of these mechanisms to hide assets from taxation and siphon money to the rich are felt at all levels – from the failure to address global crises such as climate change and the pandemic to gross inequality in housing and other essential needs.
Exposing those mechanisms and building the political will to curb illicit financial flows requires action not only in national capitals and global institutions, but also in all the jurisdictions where wealth is hidden. Nowhere is this more true than for the United States.
In Washington, this message from the Panama Papers is beginning to be heard if not yet followed.
A recent Washington Post editorial stated that “States must stop letting the ultrawealthy dodge taxes – and the law.” Despite the limited progress on national legislation, that fight can begin in states across the country – probably including yours.
Previously in tax scammage:
* McDonald’s Breaks Promise To Raise Wages.
* Last Year, Amazon Paid No Federal Income Taxes. Now, It’s Trying To Kill A Local Tax That Aims To Help the Homeless.
* Trump Vowed To Punish Companies That Moved Jobs Overseas. Is Congress Rewarding Them?
* After Long Career Bailing Out Big Banks, Obama Treasury Secretary Tim Geithner Now Runs Predatory Firm That Exploits The Poor For Profit.
* Jeff Bezos Just Became The Richest Person Ever. Amazon Workers Just Marked #PrimeDay With Strikes Against Low Pay And Brutal Conditions.
* A Sweet New Century For America’s Most Privileged.
* With Nation Transfixed By Kavanaugh Monstrosity, House GOP Votes To Give Rich Another $3 Trillion In Tax Cuts.
* Deepwater Horizon Settlement Comes With $5.35 Billion Tax Windfall.
* Offshoring By 29 Companies Costs Illinois $1.2 Billion Annually.
* Government Agencies Allow Corporations To Write Off Billions In Federal Settlements.
* The Gang Of 62 Vs. The World.
* How The Maker Of TurboTax Fought Free, Simple Tax Filing.
* $1.4 Trillion: Oxfam Exposes The Great Offshore Tax Scam Of U.S. Companies.
* How Barclay’s Turned A $10 Billion Profit Into A Tax Loss.
* Wall Street Stock Loans Drain $1 Billion A Year From German Taxpayers.
* German Finance Minister Cries Foul Over Tax Avoidance Deals.
* Prosecutor Targets Commerzbank For Deals That Dodge German Taxes.
* A Schlupfloch Here, A Schlupfloch There. Now It’s Real Money.
* How Milwaukee Landlords Avoid Taxes.
* Study: 32 Illinois Fortune 500 Companies Holding At Least $147 Billion Offshore.
* Watch Out For The Coming Tax Break Trickery.
* When A ‘Tax Bonanza’ Is Actually A Huge Corporate Tax Break.
* The Hypocrisy Of Corporate Welfare: It’s Bigger Than Trump.
* Oxfam Names World’s Worst Tax Havens Fueling ‘Global Race To Bottom.’
* Offshore Tax Havens Cost Average Illinois Small Business $5,789 A Year.
* State Tax Incentives To Corporations Don’t Work.
* GOP Tax Plan Would Give 15 Of America’s Largest Corporations A $236 Billion Tax Cut.
* Triumph Of The Oligarchs.
* Amazon Short-List Proves Something “Deeply Wrong” With America’s Race-To-The-Bottom Economy.
* Apple’s $38 Billion Tax Payment Less Than Half Of $79 Billion They Owe.
* U.S. Surpasses Cayman Islands To Become Second-Largest Tax Haven On Earth.
* Less Than Year After GOP Tax Scam, Six Biggest Banks Already Raked In $9 Billion In Extra Profits.
* After Budget Cuts, The IRS’s Work Against Tax Cheats Is Facing “Collapse.”
* $6.5 Billion: A Low-Ball Estimate Of The Walton Family’s Haul After 16 Years Of Bush, Obama And Trump Tax Giveaways.
* Illinois Could Recover $1.3 Billion Lost To Corporate Tax Loopholes.
* Whatever You Paid To Watch Netflix Last Month Was More Than It Paid In Income Taxes All Last Year: $0.
* Number Of U.S. Corporations Paying ‘Not A Dime’ In Federal Taxes Doubled In 2018.
* It’s Getting Worse: The IRS Now Audits Poor Americans At About The Same Rate As The Top 1%.
* IRS: Sorry, But It’s Just Easier And Cheaper To Audit The Poor.
* Corporate America’s Tax Breaks Have Left Society More Vulnerable To Pandemic.
* Another Tax Loophole That’s Making The Rich Even Richer.
* The Billionaire Playbook: How Sports Owners Use Their Teams To Avoid Millions In Taxes.
* The Tax Foundation’s Mythical Taxpayers.
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Previously in The Paradise Papers:
* ‘Paradise Papers’ Reveal Tax Avoidance, Shady Dealings Of World’s Rich And Powerful.
* Just How Much Money Is Held Offshore? Hint: A SHIT-TON.
* Development Dreams Lost In The Offshore World.
* Keeping Offshore ‘Hush Hush,’ But Why?
* Tax Havens Are Alive With The Sound Of Music.
* Today In Tax Avoidance Of The Ultra-Wealthy.
* Go To Town With This Offshore Leaks Database.
* The Paradise Papers: The View From Africa And Asia.
* The Paradise Papers: The End Of Elusion For PokerStars.
* The Paradise Papers: An Odd Call From The Bermuda Government.
* The Paradise Papers: Nevis Is An Offshore Haven Of Opportunity
* The Paradise Papers: The Long Twilight Struggle Against Offshore Secrecy.
* The Paradise Papers: A Fair Tax System Will Be Lost Without Public Pressure.
* Item: Today In The Paradise Papers: Through Death Threats And Scare Tactics, Honduran Reporter ‘Perseveres.’
* The Paradise Papers: Journalists Flee Venezuela To Publish Investigation.
* Last Stop: Chicago.
* The Paradise Papers: ‘Africa’s Satellite’ Avoided Millions Using A Very African Tax Scheme.
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Previously in The Panama Papers:
* The Panama Papers: Remarkable Global Media Collaboration Cracks Walls Of Offshore Tax Haven Secrecy.
* The Panama Papers: Prosecutors Open Probes.
* The [Monday] Papers.
* Adventures In Tax Avoidance.
* Mossack Fonseca’s Oligarchs, Dictators And Corrupt White-Collar Businessmen.
* Jonathan Pie, TV Reporter! They’re All In It Together.
* Meet The Panama Papers Editor Who Handled 376 Reporters In 80 Countries.
* The Laundromat.
‘A widow (Meryl Streep) investigates an insurance fraud, chasing leads to a pair of Panama City law partners (Gary Oldman and Antonio Banderas) exploiting the world’s financial system. Steven Soderbergh directs.’
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Previously in carried interest, aka The Billionaire’s Loophole:
* Patriotic Millionaires Vs. Carried Interest.
* The Somewhat Surreal Politics Of A Private Equity Tax Loophole Costing Us Billions (That Obama Refused To Close Despite Pledging To Do So).
* Fact-Checking Trump & Clinton On The Billionaire’s Tax Break.
* Despite Trump Campaign Promise, Billionaires’ Tax Loophole Survives Again.
* Carried Interest Reform Is a Sham.
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Comments welcome.
Posted on November 4, 2021