America’s super rich could be hiding trillions in international tax havens using offshore accounts, exploiting loopholes in international tax rules and successfully evading the taxman. A new report released Sunday shows that they could be hiding a staggering $21 trillion.
In order to give a little bit of perspective for what that number really means, The New York Daily News reports that Tax Justice Network, an economic transparency group, stated that the sum is bigger than the entire United States’ economy, or enough money to solve the European debt crisis completely.
The report is called The Price of Offshore Revisited, and the first details about it were released to the Observer in London. It shows that between $21 trillion and $32 trillion could be hidden in so-called tax havens in countries like Switzerland and the Cayman Islands.
Most of the money hidden overseas comes from the o.oo1 percent, who make the majority of the top 1 percent green with envy, according to economists. $10 trillion stashed in off-shore accounts is owned by a mere 92,000 people. John Christensen of the Tax Justice Network, stated:
“These estimates reveal a staggering failure: inequality is much, much worse than official statistics show. People on the street have no illusions about how unfair the situation has become.”
According to Bloomberg Business Week, the new estimate is close to three times the organization’s last estimate in 2005, which put the off-shore money at $11.5 trillion.
James Henry, former McKinsey Co. economist, stated that the trillions held by the super-rich in their offshore accounts show that there is a “huge black hole in the world economy,” of untaxed private wealth. He went on to say, “The lost tax revenue implied by our estimates is huge.”
The research shows that 139 countries who have external debts of $4.1 trillion at the end of 2010 would actually be creditors to the world, if $9.3 trillion cross-border holdings of their citizens had been taken into account.
What do you think of the fact that the super rich could be evading even more taxes on $21 to $32 trillion of off-shore funds, because of tax loopholes?
Check out more information about tax loopholes and off-shore accounts here: