A tax haven, or secrecy jurisdiction, or offshore financial center, is any country or jurisdiction that offers minimal tax liability to foreign individuals and businesses. Tax havens do not require businesses to operate out of their country or the individuals to reside in their country to receive tax benefits. They use secrecy to attract illicit and illegitimate or abusive financial flows. A global industry has developed involving the world’s biggest banks, law practices, accounting firms and specialist providers who design and market secretive offshore structures for their tax- and law-dodging clients.
Competition between jurisdictions to provide secrecy facilities has become a central feature of global financial markets, particularly since the era of financial globalisation really took off in the 1980s. The problems go far beyond tax. In providing secrecy, the offshore world corrupts and distorts markets and investments, shaping them in ways that have nothing to do with efficiency. The secrecy world creates a criminogenic hothouse for multiple evils including fraud, tax cheating, escape from financial regulations, embezzlement, insider dealing, bribery, money laundering, and plenty more.
The Corporate Tax Haven Index (CTHI) is a ranking of jurisdictions most complicit in helping multinational corporations underpay corporate income tax. It thoroughly evaluates each jurisdiction’s tax and financial systems to create a clear picture of the world’s greatest enablers of global corporate tax abuse. Jurisdictions are ranked by their CTHI value, which is a measure of how much scope for corporate tax abuse the jurisdiction’s tax and financial systems allow.
Here are the top 20 largest corporate secrecy jurisdictions in the world.
British Virgin Islands
United Arab Emirates
Isle of Man