The Government of Bermuda has hit back after the Island was highlighted for criticism by a recent report by global charity Oxfam on taxes and transparency.
The Oxfam report placed Bermuda first on a list entitled ‘The world’s worst corporate tax havens’. Other countries included the Cayman Islands, Switzerland, the Netherlands and Singapore.
According to the Oxfam report: “These countries earned their place on Oxfam’s ‘world’s worst’ list because they facilitate the most extreme forms of corporate tax avoidance, driving the race to the bottom in corporate taxation. To create the list, Oxfam researchers assessed countries against a set of criteria that measured the extent to which countries used three types of harmful tax policies: corporate tax rates, the tax incentives offered, and lack of cooperation with international efforts against tax avoidance.”
In a statement Everard Richards, Bermuda’s deputy premier and minister of finance, said that the government of Bermuda noted the Oxfam report with ‘surprise and disappointment’, adding that in its view Oxfam has made ‘substantial errors’ in those claims that encompass Bermuda.
According to the government of Bermuda Oxfam refers to: “A ranking of jurisdictions based wholly on volume of assets, not on any recognised criteria of transparency or compliance, on which measures Bermuda always scores very well. It should be emphasised too that the right to set a corporate tax rate is recognised by the UN as a sovereign right and is considered by Bermuda to be an essential contributor to its world-leading reinsurance centre, along with political stability, regulatory excellence and geographic independence.”
Richards also pointed out that Oxfam mentioned ‘anonymous shell corporations’ and that “these simply do not exist on the island, nor elsewhere in relation to corporations registered in Bermuda where continually updated beneficial ownership information is fully available to relevant international authorities on request, which is a leading position on disclosure by all international standards. In fact, Bermuda's register has been in existence for 70 years.”
He also stressed that Bermuda is fully committed to all of the relevant OECD and other global initiatives on tax avoidance and transparency, including on BEPs [base erosion and profit shifting], and scores ‘extremely well’ on all internationally recognised tables.
Richards concluded by stating that: “More generally, Oxfam, directly and indirectly, appears simply to have ignored Bermuda’s internationally recognised role as a centre of corporate and tax transparency and compliance, a key ally in the fight against money-laundering and all criminal activities, and a committed partner in the initiatives of the OECD on tax reform under the BEPs initiative. We have benefitted in recent years from a flight to quality, as companies have begun to respond to global transparency initiatives.
“We have a leading role in supporting global property/catastrophe and other insurance, which directly benefits many of the ‘poorest people’ to which Oxfam refers, as well as providing employment in many economies beyond our shores, including the UK. Bermuda provides one third of global property/catastrophe reinsurance, and around 14 percent of the aggregate global reinsurance premium is written out of Bermuda, employing 39,000 people worldwide.”
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