MECHANISMS OF FUNCTIONING OF OFFSHORE JURISDICTIONS IN THE WORLD SYSTEM
Journal: International Journal of Management (IJM) (Vol.11, No. 4)Publication Date: 2020-04-30
Authors : TETIANA I. SHYNKAR TETYANA V. KURYLO ANDRII V. KHOLOSTENKO; OLENA NAZYMKO;
Page : 500-510
Keywords : : Offshore schemes; Offshore financial centers (OFC); Money laundering; Tax havens; Offshore schemes legislation; Investigation of crimes; Money laundering;
Abstract
The article defines the essence of the mechanisms of functioning of offshore jurisdictions, which include: the stepping stone method, which consists in the division of assets among different jurisdictions; credit scheme, which involves providing loans at interest and makes it possible to transfer funds to offshore; transfer pricing, which provides for the sale of goods to the OFC residents at a lower price for subsequent resale for profit, which will be declared in the OFC (trading scheme); payment of royalties, which centers around the registration of copyrights, followed by the transfer of rights to a resident of a full-tax jurisdiction in exchange for the corresponding payments; the application of tax hybrids. The methods and schemes specified can only be applied in case of the presence of double taxation conventions among the jurisdictions involved in the schemes; they can be integrated into more complex mechanisms. Double Irish is the most famous mechanism that has simultaneously absorbed several methods. However, the mechanisms specified are not unitary or
unique.
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