A 2012 study by various US universities showed that the US has the most lenient regulations for setting up a shell company anywhere in the world outside of Kenya.[4] Tax havens such as the Cayman Islands, Jersey and the Bahamas were far less permissive, researchers found, than states such as Nevada, Delaware, Montana, South Dakota, Wyoming and New York.[2][4] "[Americans] discovered that they really don't need to go to Panama", said James Henry of the Tax Justice Network.[2] For example, a single address in Wilmington (1209 North Orange Street) is listed as the headquarters for at least 285,000 separate businesses[5] due to Delaware's desirable corporate taxes and law. As of 2016[update], it was estimated that 9 billion dollars of potential taxes were lost over the past decade, due to the Delaware 'loophole'. Both Hillary Clinton and Donald Trump have firms registered in North Orange Street,[6] and lawyers, trust companies and financial firms including Rothschild & Co are moving offshore accounts from locations such as Switzerland and the Cayman Islands into the US to take advantage of the country's loose regulations, calling it the "new Switzerland" (see Banking in Switzerland).[1]
Mark Hays of Global Witness said "the US is one of the easiest places to set up so-called anonymous shell companies",[2] and Stefanie Ostfeld from the same organization said that "the US is just as big a secrecy jurisdiction as so many of these Caribbean countries and Panama".[7] More than 1.1 million live legal entities were incorporated in Delaware at the end of 2014. An increasing number – more than 70% – of those were LLC.[8] The Delaware Division of Corporations said in August 2015 that "an LLC entices all types of people since it is easy to operate and oversee", and Delaware is currently one of the few states without sales tax.[9] Delaware does not tax the companies that operate there, nor does it tax their royalty income. However, the LLC is more popular and often less expensive in states such as Wyoming, Nevada and Oregon. Approximately 668,000 anonymous LLCs are registered just in those three states.[8]
The October 2021 release of the Pandora Papers revealed details of a number of non-U.S. figures who have used U.S. tax haven services. These include 35 world leaders and over 100 billionaires, celebrities, and business leaders.
1 2 Findley, Michael; Daniel Nielson, Brigham Young University; Jason Sharman, Griffith University. "Global Shell Games: Testing Money Launderers' and Terrorist Financiers' Access to Shell Companies". University of Texas at Austin.
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