Oxfam Releases List of 15 Worst Tax Havens

Chris Gaetano
Published Date:
Dec 12, 2016
Globe on money

Public advocacy organization Oxfam released a list of what it considers the 15 worst tax havens in the world, based on tax rates, subsidies, and cooperation with international tax enforcement efforts, according to CNN Money. To come up with this list, Oxfam started with countries that are referred to as tax havens by authorities such as the U.S. Government Accountability Office or the European Parliament. After this they looked at the countries' corporate tax rates, tax incentives offered to foreigners, and degree of cooperation with international efforts against tax avoidance. Finally they looked at the scale of corporate profit shifting through each of these countries (noting that while there may be other countries with similar tax policies, they may not be used as a major tax haven). 

So for example, Bermuda, the number one worst tax haven, has zero percent corporate income tax, zero percent withholding taxes, does not participate in multilateral anti-abuse efforts, and has evidence of large-scale profit shifting, according to the Oxfam report

The full top 15 are: 

1. Bermuda
2. The Cayman Islands
3. The Netherlands
4. Switzerland
5. Singapore
6. Ireland
7. Luxembourg
8. Curacao
9. Hong Kong
10. Cyprus
11. Bahamas
12. Jersey
13. Barbados
14. Mauritius
15. British Virgin Islands 

Oxfam attributed the prevalence of these tax havens to what it called a global race to the bottom, where countries compete to have more and more attractive tax regimes so foreign businesses will set up there, something that the report says is starving developing countries of revenue it could use for human services. For instance, it pointed out that the Netherlands is estimated to lose 1.2 billion euros, or about $1.3 billion, from one specific tax incentive alone—the "innovation box," which is equivalent to 7.6 percent of the country's total income from corporate tax. 

"Ultimately, the evidence shows that the only beneficiaries of this destructive race to the bottom are corporations and their wealthy shareholders and owners. Yet governments in every part of the world cannot resist playing a part in the race to the bottom," according to the report. 

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