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Netherlands, not Bermuda, is the tax evasion capital of the world

Paul Hodgson | July 31, 2017

Tax evasion through the creation of offshore financial centres (OFCs) is usually blamed on the islands that were formerly part of Britain – Bermuda, the British Virgin Islands, and the Cayman Islands are usually the worst culprits – but a new paper from a group of academics working in the Netherlands points to major western economies as the worst offenders. The paper identifies a small set of five countries – the Netherlands, the United Kingdom, Ireland, Singapore, and Switzerland – that are responsible for funneling the majority of corporate offshore investment, as what it terms conduit-OFCs.

First, some definitions. The paper refers to two groups of offenders: sink-OFCs and conduit-OFCs. “Sink-OFCs attract and retain foreign capital while conduit-OFCs are attractive intermediate destinations in the routing of international investments and enable the transfer of capital without taxation.” It identifies 24 primary sink-OFCs, as well as the five conduit-OFCs already mentioned... To get the full story, subscribe now.