On hearing the term ‘tax haven,’ many will picture idyllic locales with long beaches, palm trees and yachts belonging to multi-millionaires like the Cayman Islands, a British Overseas Territory in the Caribbean Sea. The more mundane reality, however, is laid out in the ‘financial secrecy index’ compiled by the Tax Justice Network in 2013.
Unimaginably vast sums of financial wealth sit in the 82 jurisdictions listed. European countries like Greece, Italy and Portugal have been brought to their knees by decades of secrecy and tax evasion.
A global industry has developed involving the world’s biggest banks, law practices and accounting firms which not only provide secretive offshore structures to their tax- and law-dodging clients, but aggressively market them. ‘Competition’ between jurisdictions to provide secrecy facilities has, particularly since the era of financial globalisation took off in the 1980s, become a central feature of global financial markets.