Three UK overseas territories are on the podium of the list of the world’s top tax havens, followed later by Switzerland, the Netherlands and Luxembourg, according to a report by the Tax Justice Network, a group of tax researchers, quoted by ‘The Guardian.
The British Virgin Islands was ranked as “the biggest enabler of corporate tax abuse,” with the Cayman Islands in second place and Bermuda third.
The United Arab Emirates was a first in this Top 10, following a new investigation finding that the country benefited from $250 billion of multinational funds routed through the Netherlands.
The report also shows that the United Arab Emirates (UAE) has emerged as a new destination for multinational companies operating in Africa and the Middle East. South Africa was highlighted as one of the biggest losers with companies moving their profits to the UAE.
A spokesman for the Tax Justice Network said that tax havens are thriving and that efforts to address the problem coordinated by the OECD have failed.
Dereje Alemayehu, executive coordinator of the Nobel Peace Prize nominated Global Alliance for Tax Justice, said the report’s findings show that the world’s largest economies are helping companies avoid $245 billion in taxes.
“Trusting the OECD in light of its findings is like trusting a pack of wolves to build a fence around your henhouse,” he was quoted as saying by ‘The Guardian’.
The corporate tax haven index ranks each country based on the intensity with which its tax and financial systems allow multinational companies to reduce their taxable profits.
“A higher ranking on the index does not necessarily mean that a jurisdiction’s corporate tax laws are more aggressive, but rather that the jurisdiction in practice plays a bigger role overall in allowing profit shifting that costs countries billions in lost taxes every year,” Alemayehu explained.
The OECD represents 37 mostly wealthy Western governments, and has spent much of the last decade trying to agree on rules to prevent tax avoidance by wealthy individuals and large corporations.
The report states that OECD countries account for 39% of the risk of corporate tax abuse worldwide. Their territories and former colonies accounted for 29%.
Countries classified by the OECD as “non-harmful” account for 98% of the world’s corporate tax abuse risks, the report said, adding that the UN should take on the role of fostering global tax rules.
See now the Top 10 largest tax havens in the world:
1- British Virgin Islands
2 – Cayman Islands
3 – Bermuda
4 – Netherlands
5 – Switzerland
6 – Luxembourg
7 – Hong Kong
8 – Jersey
9 – Singapore
10 – United Arab Emirates
