Chinese Top Brass Use Tax Havens

January 23, 2014 Tax HavensTaxation in China

Chinese Top Brass Use Tax HavensWASHINGTON D.C. – International journalist are continuing their investigations into the global corruption, and have now published a new analysis on the use of tax havens by Chinese officials.

Two relatives of the former Premier of China Wen Jiabao, the son-in-law of the current President Xi Jinping, the son-in-law of the former governor of the central bank of China Dai Xianglong, the founders of the internet giant Tencent Zhang Zhidong and Ma Huateng, China’s wealthiest woman Yang Huiya, and thousands of other wealthy and prominent people of China are using corporate structures registered in offshore jurisdictions, according to new information released on January 22nd by the International Consortium of Investigative Journalists.

This is the first such report by the ICIJ on the large scale use of tax havens by government officials and prominent figures in China for personal wealth management, and comes as the continuation of the work of international journalist to reveal and detail leaked information about the abuse and overuse of offshore entities today.

According to the report, the leaked documents show that the Chinese elite routinely utilize the services of incorporators and advisers in traditional offshore jurisdictions, such as British Virgin Islands and Samoa, often with active assistance and advice from major Western financial institutions, including UBS and PriceWaterhouse Coopers.

As a direct result of the investigations, the journalist uncovered the identities of at least 22 000 individuals from China who are named in relation to the formation, operation, or ownership of an offshore company, with many of those being among the richest and most powerful individuals in the country, both in the world of business and politics.

The ICIJ conceded that involvement in an offshore entity does not necessarily indicate that an individual is performing any illegal activities, but it was noted that offshore entities may help to hide the evidence of corruption, bribery, and other illicit activity among the country’s most powerful people.

According to experts, as a next step, the ICIJ may prepare and publish similar information on politically exposed persons from Russia and India, as it was already indicated earlier that the Consortium already has enough information to complete such an analysis.

Photo by: victoria white2010