Wyoming has become a worldwide tax haven, according to information revealed in the Pandora Papers trove of documents on the ultra rich.
A new story in The Washington Post highlight's Wyoming's "Cowboy Cocktail system of hiding wealth.
"The cocktail and variations of it — consisting of a Wyoming trust and layers of private companies with concealed ownership — allow the world’s wealthy to move and spend money in extraordinary secrecy, protected by some of the strongest privacy laws in the country and, in some cases, without even the cursory oversight performed by regulators in other states," the newspaper reported. "A dozen international clients who created Wyoming trusts were identified in the Pandora Papers, a trove of more than 11.9 million records obtained by the International Consortium of Investigative Journalists (ICIJ) and shared with The Washington Post that expose the movement of wealth around the world. The documents offer a rare look at Wyoming’s discreet financial sector and the people who rely on its services."
The newspaper noted Moscow billionaire Igor Makarov, the matriarch of Argentina’s Baggio family, and Kalil Haché Malkún of the Dominican Republic.
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"For years, anti-money-laundering experts and law enforcement have warned federal and state lawmakers that suspect money was flowing into U.S. tax havens, eluding taxing authorities, creditors and criminal investigators. In Wyoming, with the support of state lawmakers, the industry charged ahead, promoting a suite of financial arrangements to potential customers around the world," the newspaper reported. "At the heart of those arrangements are trusts, legal agreements that allow people to stash away money and other assets so they are protected from creditors and incur few or no tax obligations for themselves or their heirs."
Wyoming does not have a personal income tax or corporate income tax.
"In a competitive global market, Wyoming’s financial incentives have stood out. One trust company 8,700 miles away in Singapore recommended Wyoming on its website as a go-to tax haven that would 'completely shield' clients’ names and assets. 'Offshore Wyoming, USA,' noted another firm, this one in Ukraine’s bustling capital, Kyiv," the newspaper reported.
In his 2020 book Billionaire Wildness, Justin Farrell noted that Jackson's Teton County has become the richest county in America — and the county with the worst income inequality.
"For better or worse, specific government policies have contributed to the local changes we have seen. It is not the cause of random market forces, but deliberate choices for one tax policy over another. And even if these choices result in staggering wealth inequality, or cost the state dearly in much needed tax revenue, policies remain unchanged because of Wyoming's longstanding anti-federalist streak that has created an all-out aversion to new taxes, even if it means cutting off your nose to spite your face," Farrell explained.