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Tuesday, September 16, 2014

Delaware, US domestic tax haven, under pressure

Washington (AFP) - There are more companies than people in the small US state of Delaware, its population of under one million nestled on the Atlantic coast just south of New Jersey.

The reason is clear: the state offers companies low taxes, an efficient, pro-business legal environment, and it allows anyone to set up a company anonymously, registering a shell that hides who really controls it and controls the money within it.

That has now put Delaware, and other states that permit shell companies, in the sights of the US authorities, after they have campaigned against international tax havens like Switzerland to fight tax dodging and money laundering.

Around two-thirds of the 500 largest US companies, including Coca-Cola, Google and Walmart, are registered in the state, even as they operate from distant headquarters.

All they need in Delaware is a small mailbox, and they can enjoy the sweetheart environment it offers businesses.


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