Brookfield's Tax Avoidance Strategies

Brookfield's Tax Avoidance Strategies

On June 6, 2023, the Centre for International Corporate Tax Accountability and Research (CICTAR) released an investigative report accusing Brookfield, Canada’s largest alternative asset manager, of using over 266 Bermuda-based entities to construct a complex cross-border corporate structure. This structure has allegedly enabled Brookfield to maintain exceptionally low corporate income tax rates for years. Click the link below to read the full report:

Is Canada’s Largest Alternative Asset Manager Dodging Global Taxes? — Centre for International Corporate Tax Accountability and Research
Through complex corporate structures, with an exceptional reliance on Bermuda, Brookfield manages over $800 billion in global assets. Related party debt payments and other artificial transactions may substantially reduce taxable income where profits are earned. Brookfield’s aggressive tax avoidance

Brookfield currently manages over $825 billion in assets and is listed on both the Canadian and U.S. stock exchanges, making it one of Canada’s largest multinational corporations. The company has long been regarded as a master of tax avoidance. In fact, the Panama Papers in 2017 revealed that Brookfield had established 29 entities and limited liability companies in Bermuda to create a complex tax structure. The company’s effective tax rate has remained remarkably low, with a rate of just 5.2% in 2021 and an average effective tax rate of approximately 4.6% over the past 15 years.

The CICTAR report analyzes Brookfield's tax avoidance strategies in the UK, Australia, Colombia, and Brazil. Let’s dive into how this multinational giant manages to minimize its tax burden.