Havens

7 Places to Stash Your Billions: Bermuda & More (Photos)

From Switzerland to San Marino, these are the locales most favorable to big-dollar investments.

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Getty Images

7 Places to Stash Your Billions

Mitt Romney is in hot water for his offshore holdings—but some experts say it only makes sense for him to take advantage of friendly overseas tax laws. From Switzerland to San Marino, these are the locales most favorable to big-dollar investments.

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Bermuda

Mitt Romney's Bain-era offshore investing vehicle, Sankaty High Yield Asset Investors, was based in Bermuda, which has a very favorable tax regime for international moneymen. Mitt’s not alone in saving billions. Google allegedly has saved $3.1 billion in taxes by putting most of its foreign profits in Bermuda, Ireland, and the Netherlands, according to Bloomberg News. Bermuda, a British territory, also has an active community of American expatriates. It’s a rich economy, and offshore finance is its biggest sector.

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Lichtenstein

This landlocked, German-speaking principality has a decidedly Tea Party–friendly income tax rate: 1.2 percent. Though the rate can rise with local taxes, that hasn’t stopped hundreds of foreign corporations and individuals from stashing billions in Liechtenstein, one of the reasons it’s the richest per capita nation in the world. The nation was branded an “uncooperative tax haven” by Germany in 2008, when the economic giant discovered that hundreds of its citizens were using Liechtenstein’s LGT Bank to avoid millions in taxes. Even in the U.S., Sen. Carl Levin announced that he planned to look into whether any Americans had taken advantage of the same scheme.

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Ireland

Ireland’s rate of corporate taxation is one of the world's lowest: 12.5 percent. That brings thousands of businesses knocking, even many that don’t operate anywhere near Ireland—like the Cleveland-based Eaton Corp. Though the tax incentives brought an influx of capital during the boom years, Ireland’s recent banking crisis—which wiped out billions in shareholder value—has left some questioning its financial stability.

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The Cayman Islands

Mitt Romney has as much as $8 million invested in 12 funds based in the Cayman Islands, according to ABC News. Both his campaign and Bain Capital employees say the funds are domiciled in the famous tax shelter to attract foreign investment. Since the Caymans don’t tax capital gains, investment dividends made there are tax-free—until they’re brought back into the United States. Then the IRS will take a share. Earlier this year a former Pennsylvania state auditor was sentenced for tax evasion by failing to declare nearly $3 million in a Caymans-based account.

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Panama

A man, a plan, and a couple billion dollars can do pretty well in this Central American tax hamlet. Bank disclosure requirements in Panama are notoriously lax, and though it’s harder to hide money there than it used to be, the country’s banks have emulated Switzerland by imposing strict confidentiality requirements. This April a Miami return preparer and his client both were convicted of conspiring to defraud the IRS of more than $10 million by creating a fake Panamanian corporation.

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San Marino

For years San Marino has been a first stop for drug smugglers and contraband sellers seeking to keep their winnings away from international police. But in the past few years, the tiny European state has cracked down. In 2009 it launched an emergency census designed to reveal tax dodgers. Although the state is only 23 square miles and houses 31,000 people, it has more than 67 financial institutions.

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Switzerland

Confidential banking has been a part of Swiss culture since the Middle Ages, and Zurich is one of Europe’s most productive financial centers, home to UBS and Credit Suisse. Almost all Swiss bank accounts are entirely above the board. But some abuse them. The CIA says that Switzerland is particularly “vulnerable to the layering and integration stages of money laundering.”