The inexorable rise of the UK as the world's offshore centre

As I have written before, the real risk for offshore centres is that onshore jurisdictions will bring more and more of the products and services offered by offshore jurisdictions onshore.

George Osborne's move to reduce corporation tax to 15% is I believe just the first in a series of developments in the wake of the Brexit vote that will cast the UK as offering the same tax efficiency as an offshore centre, but within an unparalleled global finance infrastructure.

For the offshore jurisdictions' perspective this is challenging in two ways; having a more and more competitive UK would be difficult enough, but as the UK is currently regarded as a developed onshore market it has company formation, anti-money laundering and know your client requirements that are far less onerous than the better offshore centres, who are subject to far greater scrutiny. Thus the UK is not only a huge competitor for offshore centres, but also one in which it is easier to do business than an offshore centre.

David Cameron admirably banged the drum for global transparency to root out tax evasion and the secreting of assets in anonymous structures. I'm guessing that this is fast disappearing from agenda across Whitehall, as the economy reorients itself to the brave new world.

Posted on July 03, 2016

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