Dumb it down
Is Ireland really a tax haven? According to Obama it is...
The President of the United States of America, Barack Obama, recently labelled Ireland as a tax haven. But he's not serious is he?
Did Barack really label Ireland as a tax haven?
Yes, Ireland’s prodigal son did label us as a tax haven on his own website. It’s stated on the graph at the bottom of the page.
But what is the graphic all about?
Well it’s all about knocking his presidential opponent Mitt Romney (pictured above) down a peg or two. You see, Obama and Romney are currently battling it out for the US presidency and Obama is basically trying to persuade voters that Romney doesn’t have America’s best interests in mind. As you can see from the info graphic, it asks the question: “Has Mitt Romney avoided US taxes by investing millions in tax havens”.
The graphic then says, “We’ll never know because he won’t release his returns”.
I see, but is Ireland really a tax heaven?
Well it’s a bit harsh to call us a tax ‘haven’ in fairness, considering that other places in Europe such as Montenegro, Bulgaria, Cyprus, Hungry, Albania, Macedonia and Serbia all have lower tax rates – not to mention places outside of Europe. If Romney really wanted to shaft the taxman we could have used any of these.
As for being an actual ‘tax haven’, according to a certain report we technically are. At the very bottom of the graph there’s some small print that states the countries featured in the graph have been mentioned as ‘tax havens’ in a Congressional Research Service report.
Not to sound stupid, but what exactly is a tax haven?
According to the Congressional Research Service report, tax havens can be characterised as countries that have low tax rates and a lack of transparency. Apparently, we fit the bill.
Right. So what’s the story with Romney and the other countries?
Well apparently, Romney has interests in Bermuda and the Cayman Islands which both have tax rates of 0 per cent. His Irish interests are taxed at only 12.5 per cent whereas investments in America can be taxed as high as 35 per cent. He also apparently has a Swiss bank account that has over $3,000,000 dollars in it which luckily for him isn’t taxed because it’s apart of a Specialised Investment Fund.
Basically, Obama wants to see Romney returning any overseas investments back to American soil where it will benefit US citizens.
Two chances of that happening I'd say. But is Romney doing anything illegal?
Nope. At the end of the day, it’s his money. So he can do what he likes with it. Obama is just hoping that drawing attention to this sort of stuff will persuade Americans not to vote for him in November's election.