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earlier there are several key states which are a part of the membership of the OECD that

have preferential tax regimes present in their respective tax codes.

Briefly, a few highlights of those states includes the following:

Canada has extremely lax rules with respect to taxation of immigrant income. By setting

up a pre-immigration offshore trust an immigrant to Canada can legally escape income

tax on their foreign earned income for up to five years.71

France has allowed investors in their French overseas territories huge tax incentives.72 As

a result of changes in the French Code, since 1986 investors in overseas territories and

departments have been able to deduct their entire investment and in some cases double

deduction for losses they may have incurred.

73

Hungary has now developed its own offshore center. The Wall Street Journal has

reported74 that some towns there are flourishing economically as a result of offering

preferential tax regimes as low as 3 percent to foreign investors on their foreign earned

income.75

71 Harmful Tax Competition: Who Are The Real Tax Havens? By Marshall J. Langer Langer makes the case that many of the OECD member states are themselves fall foul of the Harmful Tax Competition report. He suggest that the OECD should concentrate its efforts firstly on seeing that its own member states clean up their preferential tax regimes before venturing out to the smaller interdependent economies. However, beginning in 2001 the French government has proposed to curtail these benefits. Ibid See Reed, John “Corporate Giants Find Relief From Big Taxes In Tiny Towns” Wall Street Journal Interactive Edition February 9th, 2000 Ibid 72 73 74 75

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