Grey Economy

Tax Evasion
1. Illegal non-payment of tax or underpayment
2. Individuals who do not declare the right amount of tax. Such as barbar's who get payed in cash and do not declare the correct amount
Tax Avoidence
1. Using all legal means and loopholes within the system to avoid paying tax
2. Companies such as Burger King bought Tim Hortons so that they can reduce the amount of tax they pay.
3. More and more people are now saving into workplace pensions, as part of a government drive to increase savings for the future.
4. If your partner or spouse is paying less income tax than you then it makes sense to transfer some of your assets to them to lower your potential tax bill.
5. Raising Kids who are financially dependent allows for tax breaks.
6. entrepreneurs can pay themselves a reasonable, smaller salary, the mega-rich can take a higher portion of their income as dividends
Tax Havens
1. Panama papers
  1. 11.5 million secret files are 140 politicians from more than 50 countries connected to offshore companies in 21 tax havens.
  2. A whistleblower in the 2016 Panama Papers leak, who turned over 11.5 million documents from the law firm Mossack Fonseca to the newspaper Süddeutsche Zeitung.
  3. Some people caught include: Ian Cameron- Father of David Cameron, Prime Minister of Britain, Jackie Chan, Lionel Messi- Argentinian soccer player, and Nawaz Shariff the former PM of Pakistan
2. Jurisdictions in which the tax rate is very low or not imposed or regulated.
  1. Allow individuals who fall under a higher tax bracket to avoid paying taxes in their own country by putting money offshore.
  2. A company or a trust is set up or a ready-made firm, with the help of offshore investment advisers.
    1. One or more "nominees" are hired to run business matters for the company or trust. These agents don't manage the money directly but act on the owner's behalf
      1. Smuggle the money in the chosen offshore bank account
3. Paradise Papers
  1. Apple, Nike, Glencore, Facebook, Disney, Walmart, Yahoo! and Uber are among some of the world’s largest corporations to own offshore companies.
  2. Appleby, an offshore law firm, provided around 13.4 million files of material.
  3. The Paradise Papers are a set of 13.4 million confidential electronic documents relating to offshore investments that were leaked to the German reporters Frederik Obermaier and Bastian Obermayer by Appleby.
The value of Canada’s underground economy in 2013 totalled $45.6 billion, or about 2.4 per cent of the country’s gross domestic product.
1. This means that about 50 billion dollars are lost in tax revenue that could be used to find schools such as FFCA High School. It could help build roads, and social welfare programs
  1. 50% of the underground economy is contributed by Residential construction (27.8 per cent) Retail trade (12.5 per cent) Accommodation and food services (11.7 per cent)
    1. Much of the underground economy is illegal drugs, weapons, poaching, and even human trafficking

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Grey Economy

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