Today is the 14th July 4th, I’ve worked and paid taxes in the USA. July the 4th is the day the ‘mericans celebrate their freedom from the Evil Empire, no not the one with Darth Vadar, the British Empire. That freedom initially started with a protest over taxation on tea.
I’ve been joking that I’m going to make my annual pilgrimage down to Congress Bridge to dump my used(tax paid) tea leafs off the bridge in protest of the fact that I, like the original Boston Tea party protesters, get taxed but can’t vote. My mini-jest even made the Danny Baker radio show on BBC Radio London today.
Since Britain has suffered with surfeit of stories about both individual and corporate tax evasion. Here in the US, the recent Vanity Fair article about the tax affairs on US Presidential hopeful Mitt Romney, raise the question on why anyone could ever trust him as a defender of the USA.
I’ve been reading Fran Hendys excellent Offshore blog. And to celebrate July 4th, I thought I’d list some excellent US tax avoidance, that no one here would ever raise a question about, Delaware.
While US Regulators and agency’s have been going after secrecy, anonymity and tax havens all over the world in an effort to force them to comply with US Federal tax regulations. Meanwhile, back in Delaware, no one says a word…
- Google, Apple, Coco-Cola, Bank of America, Ford, General Electric, JP Morgan Chase, Wal-Mart, American Airlines and at least 285,000 others will tell you that this is their legal address.
- More than 50% of all U.S. publicly traded companies and 63% of the Fortune 500 is incorporated in Delaware. Last year 133,297 businesses set up there.
- With a population of 907,135, the estimated 897,934 number of businesses in Delaware means that in that state there is almost one corporate entity per person.
- That most companies are ‘shell’ entities with no assets, no employees and no-real business activity in the state accounts for Delaware’s enviable track record
- Here in Texas we’ve just started paying sale tax on Amazon.com because it was ruled an Amazon distribution warehouse was a place of commerce. The Delaware loop is an arrangement that allows companies to lower the taxes they pay in the states where the business entities actually conduct substantive activity or where they are head-quartered by shifting royalties and similar remuneration to holding companies in Delaware.
- In 2011, Delaware collected roughly $800million in taxes and fees from its largely ‘absentee’ corporate residents. Since 1992, Delaware has deprived other states of an estimated $9.5billion in revenue.
- Mr. Finzer, an American based in Novi Sad, Serbia, advertises his services online. “Tax-Free Havens for Non-U.S. Citizens,” his site, says. It continues: “More than 50 percent of the major corporations in the world are incorporated in Delaware. Why? Because it provides the anonymity that most offshore jurisdictions do not offer.”
Disclosure: Personally, I have yet to file my US 2011 taxes, they’ve had a bunch of my money, more than an average US yearly wage, I’m too lazy and if I owe, will pay the interest. I promise to get in done by Sept. 1st. Both Corporations I own I registered in Texas.