Most people do not understand the complexities of offshore tax. They have no need to – because they do not have enough money to consider the schemes and arrangements that are on offer in tax havens. The “ordinary” world and the “offshore” world have coexisted for decades, separated by the secrecy that remains one of the important attractions of the sector.
This secrecy – and inconsistent scrutiny – has served it well.
Over the past 40 years, offshore tax regimes have grown exponentially; back in the 1970s, they were a way for individuals to hide their money from corrupt and predatory governments in unstable countries, or for banks to move cash around to avoid fluctuations in currency rates.
Then, the lack of transparency and advantageous tax regimes made them the investment place of choice for the rich and famous who wanted legitimate but tax-efficient investments for their wealth.