OFC's Flashcards
What are the potential benefits of well-regulated OFCs?
-Cooperation with tax authorities, low or not tax doesn’t mean harmful practice
-specialised expertise in international finance
-ability to adapt quickly to changes due to being small and reliant on financial industry
-greater supervisory standards than other jursidcitions
-strict tax rules in high tax % locations can deprive OFC’s of business, depriving multinationals of competitiveness
What are the potential downsides of OFCs?
-Tax evasion
-need for compliance of international tax laws + AML to abolish regulatory loopholes, which are attractive to money launderers or corrupt leaders
-potential for facilitating illicit activities (Africa lose >£50bn, costs poor countries £160bn - double int aid)
-many OFC’s ring fence their own economies
-naming and shaming needs adopting against offending jurisdictions
