Assignment 7. a) Read and discuss the text.

B) Sum up the text in 5-7 sentences and present your

Summary in class.

c) Give your opinion on ‘tax havens’.

TAX HAVENS EXPLAINED

What do the Bahamas, Bermuda, Hong Kong, Liberia, the Netherlands, the New Hebrides, Panama, and Switzerland have in common? They are all ‘tax havens’.

Essentially a tax haven is a place where foreigners may receive income or own assets without paying high rates of tax upon them. Although, strictly speaking, not all tax havens are countries, we can refer to them as such here for the sake of convenience. Even though the list of tax havens includes several developed countries, most of them are developing countries.

Tax haven operations consist in establishing within a tax haven country one or more legal entities, such as trusts, personal holding companies, or corporate subsidiaries, and attributing to them income earned elsewhere in order that it should be taxed at the country’s low rates – or perhaps not taxed at all.

Low tax rates are perhaps the principle attraction offered by tax havens. Usually these low rates are associated with income taxation. It is true that many of the advantages offered by tax haven countries are income tax advantages, but these are not the only benefit that these countries offer to foreign investors.

The absence of other taxes such as estate, inheritance, and gift taxes may be as important to certain investors as the absence of an income tax.

Strict and well-enforced rules of banking secrecy and, in general, the possibility of doing business without close supervision by government agencies are additional attractions usually offered by tax haven countries. Other important factors are the low cost of doing business, the existence of liberal banking regulations, and the absence of exchange controls. Finally, a well-developed legal system with an abundance of legal and accounting expertise, and a high degree of political and financial stability also help to make a country successful as a tax haven.

Words your may need:

tax heaven – налоговое убежище

strictly speaking – строго говоря

for the sake of convenience – из соображений удобства

trust – траст

holding company – холдинговая компания

subsidiary – дочерняя компания

attribute (to) – приписывать (кому-либо), относить (за счет/на счет ч-л)

to be associated (with) – быть связанным (с)

estate tax – налог на недвижимость

inheritance tax – налог на наследство

gift tax – налог на дарение

well-enforced – (зд.) действенный

abundance – изобилие, избыток

DISCUSSION

1) What is usually taxed?

2) What is an excise duty? Why were excise duties introduced?

3) What rights do local bodies of authority have regarding taxes?

4) How can tax assessment be done?

5) What do you think about tax collection in Russia: is it poor or not?

6) What measures, in your opinion, can improve tax collection in Russia?

Дата добавления: 2015-11-14