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There's a graph missing after the first graf. SD est #1 with 81 vehicles. FL #2 with 37, Texas 24.
Link to the full report at the bottom of the Irish Times piece.
Quote:
South Dakota
The Pandora Papers provide an insight into how South Dakota, Nevada and more than a dozen other US states have transformed themselves into leaders in the business of selling financial secrecy.
Meanwhile, most of the policy and law enforcement efforts of the world’s most powerful nations have stayed focused on “traditional” offshore havens such as the Bahamas, the Caymans and other island paradises.
Year after year in South Dakota, state politicians have approved legislation drafted by trust industry insiders, providing more and more protections and other benefits for trust customers in the US and abroad.
Customer assets in South Dakota trusts have more than quadrupled over the past decade to $360 billion. One of the state’s largest trust companies says it has clients from 54 countries and 47 US states, including more than 100 billionaires.
By 2020, 17 of the world’s 20 least-restrictive jurisdictions for trusts were American states, according to a study by Israeli academic Adam Hofri-Winogradow. In many cases, he said, US laws have made it more difficult.
Using documents from the Pandora Papers, ICIJ and The Washington Post identified nearly 30 US-based trusts linked to foreigners personally accused of misconduct or whose companies were accused of wrongdoing.
Among them is Guillermo Lasso, a banker and former Ecuadorian provincial governor who was elected president in April. Leaked records show that Mr Lasso set up trusts in South Dakota four years ago amid media reports that he had used offshore companies to conceal his interests in a bank. Mr Lasso was not charged with a crime.
Mr Lasso said that his past use of offshore entities was “legal and legitimate” and that he complies with Ecuadorian law forbidding public officials from owning offshore companies.
Another wealthy Latin American who set up a trust in South Dakota is Federico Kong Vielman, whose family is of one of Guatemala’s economic powerhouses.
Trusts set up in the US remain cloaked in secrecy, despite enactment this year of the US Corporate Transparency Act, which makes it harder for owners of certain types of companies to hide their identities.
Everyone in SD can now start demanding Swiss pay rates.....
Headline:
1 big thing: South Dakota is the new Switzerland
Quote:
South Dakota has become one of the world's foremost tax havens — right up with the Cayman Islands, and ahead of old-fashioned Switzerland, Axios Capital author Felix Salmon writes.
That's a fascinating finding from the Pandora Papers leak of confidential financial information about the world's rich.
"South Dakota offers the best privacy and asset protection laws in the country, and possibly in the world," Florida-based tax expert Harvey Bezozi told The Guardian as part of the blockbuster series.
Why it matters: Hundreds of billions of dollars are sequestered in South Dakota trusts — generating no taxes and remaining effectively off limits to anyone who might have a legitimate claim on them.
Why South Dakota does this: It generates financial-services jobs, and boosts the state's business bona fides.
How it works: South Dakota has no income tax, no inheritance tax and no capital gains tax. But the state has gone even further: South Dakota allows for extreme secrecy when law enforcement comes knocking, and protects assets from being claimed by creditors, ex-spouses, or pretty much anybody else.
By setting up a trust, the "settlor" — some billionaire — gives assets to a trustee in South Dakota. The trustee invests the assets for a "beneficiary," often a relative of the settlor. Neither the settlor nor beneficiary needs to set foot in the Mount Rushmore State.
All three parties — the settlor, the trustee and the beneficiary — can legally claim that the money isn't theirs.
How it happened: South Dakota started carving out its position as the most laissez-faire state for financial services in 1981, when it abolished upper limits for credit-card interest rates. (That's why the credit card in your wallet was likely issued in South Dakota.)
In 1983, South Dakota became the first state to allow perpetual trusts — money that can remain untouchable for centuries, with no one ever paying inheritance tax on it.
Since then, South Dakota has continued to pass laws making its trusts more attractive to the world's ultra-wealthy.
I'm not sure what the purpose of this thread is. I didn't see anything in the article that hasn't been well known for decades. South Dakota tries to be the leader in some finance sectors because it brings jobs to the state. While South Dakota is a leader, there are several other states with very similar laws for the same reason. And there is no hiding anything from the federal government. AFAICT there's nothing to see here.
I'm not sure what the purpose of this thread is. I didn't see anything in the article that hasn't been well known for decades. South Dakota tries to be the leader in some finance sectors because it brings jobs to the state. While South Dakota is a leader, there are several other states with very similar laws for the same reason. And there is no hiding anything from the federal government. AFAICT there's nothing to see here.
Well known for decades to South Dakotans maybe, but a lot of Americans outside SD, (and there are many), are likely unaware of the degree to which SD has risen in the hierarchy of tax havens. So I thought it would be worthwhile to let SDs see what the outside world was reading about them. At the time I started the thread there was a big fat zero in the SD media, and since then most that I've found has been behind a paywall. Argus etc.
Well known for decades to South Dakotans maybe, but a lot of Americans outside SD, (and there are many), are likely unaware of the degree to which SD has risen in the hierarchy of tax havens. So I thought it would be worthwhile to let SDs see what the outside world was reading about them. At the time I started the thread there was a big fat zero in the SD media, and since then most that I've found has been behind a paywall. Argus etc.
Articles like this come out periodically. Here's one from 2019:
South Dakota is doing nothing illegal or unethical, and anyone who goes to an estate planner anywhere in the country knows each state has its own set of trust laws. There's no difference between this and having different sales tax rates. It's just a way to bring jobs into the state. Unlike an actual tax haven, South Dakota can hide nothing from the federal government.
If Iowa outlaws beer I have no doubt many Iowans would drive to South Dakota for beer - that doesn't mean South Dakota is doing something bad. It would mean Iowa isn't doing what its citizens want because they have to leave the state to get the products they want.
South Dakota is doing nothing illegal or unethical, and anyone who goes to an estate planner anywhere in the country knows each state has its own set of trust laws. There's no difference between this and having different sales tax rates. It's just a way to bring jobs into the state. Unlike an actual tax haven, South Dakota can hide nothing from the federal government.
If Iowa outlaws beer I have no doubt many Iowans would drive to South Dakota for beer - that doesn't mean South Dakota is doing something bad. It would mean Iowa isn't doing what its citizens want because they have to leave the state to get the products they want.
I don't believe anyone has claimed that SD is doing anything illegal, (unethical is a different question and standard). Hiding anything from the feds is a non-sequitur. The issue is that tax havens such as SD, (yes it is a tax haven), allow people do something that they couldn't do in their jurisdiction(s) of responsibility because it would be illegal there.
The US has been pushing a proposal at the OECD for a minimum corporate tax rate internationally. I don't know if that will affect current SD status, but if it is deemed successful there will likely be further proposals to limit tax havens which could affect.
I don't believe anyone has claimed that SD is doing anything illegal, (unethical is a different question and standard). Hiding anything from the feds is a non-sequitur. The issue is that tax havens such as SD, (yes it is a tax haven), allow people do something that they couldn't do in their jurisdiction(s) of responsibility because it would be illegal there.
The US has been pushing a proposal at the OECD for a minimum corporate tax rate internationally. I don't know if that will affect current SD status, but if it is deemed successful there will likely be further proposals to limit tax havens which could affect.
This has nothing to do with corporate taxes. It has everything to do with trusts. E.g., South Dakota trusts can last forever. In many states they're limited in duration. If you want a trust that can last more than one or two generations you have to set it up in a state that allows it. No one (at least in the US) is getting away with anything. They are simply using a service not available in their own state.
If people in other countries are putting their money here in a trust and illegally not reporting it to their own governments, the resolution to that is a treaty with the US government to provide transparency to catch tax cheaters. The US has essentially forced all other countries to provide that transparency to us, but made the decision not to reciprocate. If the US signs that type of treaty with another country, their government will know everything their citizens are doing in the US, and no state can prevent it. Note that even today, people who do this are not able to evade US taxes on their trust earnings.
I don't believe anyone has claimed that SD is doing anything illegal, (unethical is a different question and standard). Hiding anything from the feds is a non-sequitur. The issue is that tax havens such as SD, (yes it is a tax haven), allow people do something that they couldn't do in their jurisdiction(s) of responsibility because it would be illegal there.
The US has been pushing a proposal at the OECD for a minimum corporate tax rate internationally. I don't know if that will affect current SD status, but if it is deemed successful there will likely be further proposals to limit tax havens which could affect.
BTW, even the article you linked doesn't accuse anyone in any country of avoiding taxes or doing anything that would be illegal in their own country through their SD trusts. It accuses them of being hypocrites for conducting their personal affairs in secrecy in the opposite way of their public statements, but that's about it.
I'd really like to see a report of the actual "jobs" (and job quality) created through SD's lax finance regulatory environment. Growing up in Sioux Falls, I would say it generally felt like there were everyday South Dakotans *from* the state, whose incomes were overwhelmingly low, moderate, or scratching-by middle class--- and then there were the corporate execs transferring from out of state who built their McMansion on the hill (Prairie Tree and surrounding areas). Back then the much-lauded growth of the finance sector at large generally resulted in everyday South Dakotans getting shoddy part-time $10/hr call center jobs with Citibank (not sure what the case is these days, and I guess I know a small handful of persons that graduated with me who now work in the finance sector there).
But I really hope that someday South Dakotans start holding their elected reps accountable to not selling them out to corporate or national right-wing interests-- it seems there's a long history of SD politicians greenlighting out-of-state lobbyists drafting legislation for them. **$360 BILLION**-- how much benefit is the average South Dakotan (or the state's general infrastructure) getting from this????
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