Tax paradise

In the action movie "The Bourne Identity," Matt Damon starring a lead character suffering amnesia finds his traces through a secret Swiss bank account. One of the notable things in the movie is how a Swiss bank operates in secret. Tax havens including Swiss banks play a balancing act between customer confidentiality and tax evasion. British Virgin Islands are in the global limelight among tax havens because the International Consortium of Investigative Journalists headquartered in Washington D.C. exposed the list of celebrities who hided their assets there Thursday.

The list includes the daughter of former Filipino dictator Ferdinand Marcos, the wife of Russian Deputy Prime Minister Igor Shuvalov, former wife of former Thai Prime Minister Thaksin Chinnawat, and the son of former Malaysian Prime Minister Mahathir Mohamad. Virgin Islands are located in the West Indies. They have as many as 80 companies in which Koreans invested. As the islands had some illegal inheritance cases using a paper company, Korea`s National Tax Service has stepped up to get the list.

Christopher Columbus discovered Virgin Islands in 1493. How mysterious and beautiful the islands must have been to be called “virgin” by the expedition? Virgin Islands consist of two groups of islands, the United States Virgin Islands (some 40 islands) and the British Virgin Islands (some 30 islands). Among the islands, Colombus named “Virgin Gorda," which means "fat virgin," for an island for its bulging shape. In addition to Virgin Islands, tax havens are located in scores of places such as the Bahamas, Bermuda, Samoa, and St. Lucia.

The Guardian estimated that tax havens harbor 32 trillion U.S. dollars. Those places are the “tax paradise” for the rich since taxes are levied at a low rate or not at all. The thing numerous tax havens have in common is the fact that they are famous resort places with emerald-colored sea and coral reeves. After the Park Geun-hye administration declared "war against the underground economy," the rumor that "currency reform is impending" has spread among the wealthy, and gold nuggets are reportedly sold well. A minister nominee of the new administration who had claimed the "legalization of the underground economy" had to step down for his alleged offshore assets. Let us see what will happen after the list of Virgin Islands is released.

Editorial Writer Shin Yeon-soo (ysshin@donga.com)