Tuesday, July 24, 2012

$32 trillion hidden in offshore havens by super rich

Reuters:

London — Rich individuals and their families have as much as $32 trillion of hidden financial assets in offshore tax havens, representing up to $280 billion in lost income tax revenues, according to research published on Sunday.

The study estimating the extent of global private financial wealth held in offshore accounts — excluding non-financial assets such as real estate, gold, yachts and racehorses — puts the sum at between $21 trillion and $32 trillion.

The research was carried out for the British-based lobby group Tax Justice Network, which campaigns against tax havens, by James Henry, former chief economist at consultants McKinsey & Co.

Henry used data from the World Bank, International Monetary Fund, United Nations and central banks.

The report also highlights the impact on the balance sheets of 139 developing countries of money held in tax havens by private elites, putting wealth beyond the reach of local tax authorities.

The research estimates that since the 1970s the richest citizens of these 139 countries had amassed $7.3 to $9.3 trillion of “unrecorded offshore wealth” by 2010.

Private wealth held offshore represents “a huge black hole in the world economy,” Henry said in a statement.

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