Monday, December 23, 2013

Global Impact: "Free-Ports" Used to Conceal Valuables to Avoid Taxes, Virtually Indefinitely

According to The Telegraph, the wealthy increasingly are hiding works of art, gold, collectibles and vintage automobiles in "Free-Ports" to avoid paying taxes.

Additionally, the list of valuables that can be stored in "Free-Ports" is almost unlimited: The goods that can be stored in "Free-Ports" can include cases of wine, gold, stamp and coin collections, rugs, tapestries and even vintage automobiles. 

The warehouses are generally located near airports and docks in financial hubs that are home to the wealthy and influential in such nations as Panamá, Switzerland, Monaco, Singapore, etc.

Unfortunately, for many foreign governments, "Free-Ports" are being used extensively by the well-to-do to "hide" valuables worth billions, according to The Economist

Geneva’s "Free-Port," for instance, is spread across two sites which includes 140,000 square meters (1,506,947 square feet):

COMMENT: A "Free-Port" is best described as a financial no-man’s-land with the "free" referring to the suspension of customs duties and taxes. This tax benefit was originally intended to be temporary, to cover goods while they were in transit across the world. 

Yet, over time, the wealthy have been able to store valuables in "Free-Ports" almost indefinitely, despite being technically "in transit." 

In essence, "Free-Ports" offer security and confidentiality, making them a valuable tax-mitigation tool. 

A high-value item can be stored for decades in such a facility without attracting a levy, and items are generally free of value-added and capital gains taxes when sold.

For a list of "Free-Ports," see: 

One asset class, vintage cars, has increased a staggering 430% in the last decade alone, according to