Spain’s Startling Move

One tends to have the notion of the United States as a country where tax evasion would be an extremely hazardous activity, but the Panama Papers affair has made countries like Spain turn their eyes towards the US as today’s new tax haven. While Obama has recently labeled tax avoidance as a big global problem, his administration has not accepted the international standards issued by the Organization for Economic Cooperation and Development (OECD) aimed at cornering tax evaders and money launderers. Though seasoned tax havens like Switzerland and Bermuda have complied to sharing a certain amount of their banking information with the international fiscal authorities, the small group of countries declining to team up includes Panama and the United States.

Rothschild –the multinational banking advisory based in London– has just opened a branch in Reno, Nevada, almost door-to-door with two of the city’s largest casinos. The fortunes of its multibillionaire clients are being funneled from standard tax-shelters like Bermuda to new exempt reservoirs in the Silver State, as Nevada is known. Now that the Panama scandal points to dozens of prominent Spaniards –from the King’s aunt Pilar de Borbón to Nobel laureate writer Mario Vargas Llosa and director Pedro Almodóvar–, bank funds are being massively transferred from the Central American tax-shelter to American states such as Nevada, Wyoming and South Dakota, all three of which promote low taxes and confidentiality in their trust laws. It is now easier to conceal fortunes in the United States than in Switzerland, Luxembourg, the Cayman Islands or Panama itself. While Spanish financial advisories begin to think about crossing the Atlantic too, banking experts are rubbing their hands as they think of ways to dodge the current legislation in order to make the most of this golden opportunity.