More than six billion euros. Or, what comes to be the same, five times the GDP of Spain. This is the astronomical figure that, according to IMF estimates, hides in tax havens around the world and subtracts tax revenues from the States. Despite the numerous initiatives that have been put in place to foster collaboration between jurisdictions and bring out the opaque hidden funds in offshore centers, there is still a long list of territories characterized by an unshakable banking secrecy, lax tax rules and little or no corporate transparency. And who heads it are not just paradise islands lost in the middle of the ocean.
The Cayman Islands, the United States and Switzerland are the worst-off territories in the Financial Secrecy Index 2020, just published by the independent Tax Justice Network. This index drinks from a myriad of variables that measure the degree of financial transparency of a territory to reflect “the potential damage” caused by each of them. The final result stems from the combination between the degree of opacity and the participation of each jurisdiction in offshore financial services over the global total.
The Cayman Islands, which belong to the United Kingdom, are at the top of the ranking. Its opacity level is not the highest - since they occupy the Maldives - but it is compensated by the large volume of funds that its financial system guards. Brussels has just included the archipelago in its black list of tax havens, just a few days after the Brexit was consummated.
Also in Switzerland, which is in third place, the amount of assets weighs more than the lack of transparency. The EU, however, has stopped considering it a pernicious territory thanks to the fiscal reform that it has implemented. The US, which occupies the second position, is another favorite destination for wealthier foreigners thanks to the attractiveness of tax regimes such as Delaware, a tiny state that has more and more companies than inhabitants.
Nor does the EU stand out in the photo: Luxembourg and the Netherlands occupy the sixth and eighth place in the ranking, respectively, over a total of 133 jurisdictions. A short distance away, in twelfth place, is the United Kingdom. For this reason, the organization once again regrets Brussels's lack of firmness in light of the transparent regimes within its borders and avoids including them in its list of tax havens. According to the report, the community territory is home to about a third of the total of the least transparent jurisdictions in the world, but the EU blacklist only includes 10% of the offshore territories that exist.