By Jennifer Emms, Partner, Maurice Turnor Gardner
At STEP LatAm in São Paulo, I was struck by how many of the discussions reflected questions we are also considering in the UK. Despite our different geographies and political systems, there was much that felt familiar, from debates about wealth inequality to the reasons families establish trusts and the opportunities for philanthropy.
Wealth and tax from different perspectives
How should governments address wealth inequality? Could a wealth tax be effective? What would a billionaire tax look like? These questions feature in UK headlines, and they were reflected in the conference discussions.
Comparing countries’ experiences of wealth taxes brought out the practical difficulties alongside the theoretical arguments. Inefficient tax collection, induced migration and the risk of a tax becoming confiscatory all featured.
The discussions also focused on the UN’s increasing role in international tax policy, bringing a different balance of regional perspectives from the OECD. The focus is on what it would take to make the global tax system work for everyone, particularly developing countries and not just the countries best equipped to navigate it. 2027 should see final texts being delivered to the UN General Assembly of an international tax cooperation framework (UNFCITC) and two protocols on the taxation of cross-border services and on preventing and resolving tax disputes.
The reasons families establish trusts
A discussion following Brazil’s clarification of its tax treatment of trusts was a reminder that tax is not the be all and end all.
Avoiding lengthy and complex probate, making provision for incapacity as populations age, and asset protection were all raised as wider drivers for families to establish trusts. The use of trusts to hold operating company groups can negate the need for shareholders’ agreements and Wills and offer flexibility to better achieve the family’s wishes. These types of concerns are of relevance well beyond any one country.
Opportunities for philanthropy
The discussions highlighted plenty of opportunities for philanthropy. Although tax incentives for charitable giving can be limited in Latin America and families often invest abroad, panellists explored the considerable scope for local impact investing.
There was also discussion of the reassurance donor-advised funds can offer through due diligence and oversight of the charitable use of funds.
My own thought was that English charities may also have a role to play. They offer an established regulatory framework, and their funding does not have to be spent in the UK, provided the overseas activity falls within their charitable purposes and the appropriate oversight is in place.
At MTG, our team advises on philanthropy alongside trusts, tax and immigration matters, working with local lawyers, trustees and family office advisers where their clients have UK connections.
AI in practice
A live demonstration showed how AI could present asset and investment data to families, allowing them to consider their exposure to particular world events and model a planned restructuring.
This was coupled with a look at its more sinister uses in making financial crime easier, quicker and more accessible, to the detriment of banks, fiduciaries, asset managers and their clients.
After the conference, I fell in love with Brazil, survived a helicopter ride over Rio with the most amazing views and discovered that, despite excellent tuition, I have a long way to go before an alternative career in street art!
MTG advises clients from Latin America on trusts, tax, immigration, high-value property and philanthropy where they have UK connections. We are a dedicated private client firm providing UK advice, working alongside local lawyers, trustees and family office advisers.
