A Tax Perspective on the Enforcer’s True Role in Onshore and Offshore Common Law Jurisdictions

The queries and contentions regarding the place of the enforcer principle in common law jurisdictions such as that of the United Kingdom have been orphaned in a conceptual pandemonium, bringing about an identity crisis to the realm of Trusts & Equity. Debates as to what constitutes the kernel of trusts have shed little light in determining the practical use, values and dangers of the enforcer principle. Moreover, there exist little expository publication clearly elucidating why such principle happens to mainly be invoked in offshore jurisdictions notably known to be tax havens. This essay seeks to show how commercial non-charitable purpose trusts without beneficiaries, often combined with other artificial corporate structures, help businesses engage in more aggressive tax planning. A particular focus will be set on the practical, economic function of non-charitable purpose trusts enforcers in both onshore and offshore jurisdictions. The findings will show that if left untrammelled, there is a risk that businesses will come up with creative manœuvres undermining the taxation ethics and seek to avoid tax in the commercialising market economy