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A tax haven is a nation other than your own that has lower tax rates and more confidential banking procedures than are found where you reside or normally do business. These havens are made up of about 70 countries and jurisdictions (generally small in size) that provide no-tax or low-tax status and offer a variety of taxation-related incentives to individuals and organizations who wish to bank, incorporate, or headquarter their business within the country in question.

Tax havens are controversial, especially since much of the world's wealth (up to one third) is held “offshore” in such entities. Opinions also differ as to their overall impact, so it is helpful to distinguish between the legal, illegal, and unethical practices associated with tax havens. After all, tax collectors ...

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