Wealth stashed in tax havens tops $8 trillion globally
The super-rich across the world are increasingly moving their money to offshore tax havens, according to a new research paper by economists Annette Alstadsæter, Niels Johannesen and Gabriel Zucman. The trio estimate that $8 trillion, or more than a tenth of global gross domestic product (GDP), was stashed away in tax havens in 2015. While the share of traditional tax havens such as Switzerland has declined in recent years, that of Asian centres such as Hong Kong has increased.
The portion of wealth held abroad is reportedly the highest for Russia, Gulf states, Latin American countries and a few countries from the African continent. Surprisingly, India ranks relatively low in terms of amount of wealth stashed abroad, relative to the size of its economy. This could partly be due to the use of offshore shell companies, which often mask the actual origin of funds. Another reason could be that the country-wise estimates of offshore wealth are based solely on liquid offshore bank deposits. Thus, these estimates do not take into account investments in equities and real estate. The country-wise estimates are, at best, indicative figures while the overall figures for global offshore wealth are based on a broader set of data and appear to be more robust.