The Organisation for Economic Cooperation and Development (OECD) has estimated that about $11 trillion, more than 10 times the amount committed by G-20 leaders to revive the world economy, is held in tax havens, even as it released the black list of non-cooperative nations.
Estimates of the value of assets held in tax havens range from $1.7 trillion to $11.5 trillion, the OECD said while naming Malaysia, the Philippines, Uruguay and Costa Rica as countries that have not agreed to implement international tax standards.
Mauritius, the country from where large amounts of investments are routed to India, figures among the nations that have substantially implemented tax standards.
Among the countries that have committed themselves to the internationally agreed tax standards but have not yet implemented them are Singapore, Switzerland, Bahamas, Bermuda, British Virgin Islands, and Cayman islands.
The OECD, which is a grouping of developed nations, released the list of blacklisted countries soon after the G-20 leaders announced a plan impose sanctions against tax havens.
“This is the start of the end because country after country is now signing up to the principles that have been set forward internationally. The principle is that you got to be prepared to exchange information about tax,” UK Prime Minister Gorden Brown told reporters after the summit.
The OECD takes into account many factors to determine a jurisdiction as a tax haven, including whether the country imposes “no or only nominal taxes”. Other criteria includes lack of transparency and whether laws prevent exchange of information related to tax with other governments.
Other nations which have not substantially implemented international tax standards are Andorra, Anguilla, Antigua and Barbuda, Aruba, Belize, British Virgin Islands, Cook Islands, Dominica, Gibraltar, Grenada, Marshall Islands, Monaco, Montserrat, Nauru, Antilles and Niue.
The list also has names of Panama, St Kitts and Nevis, St Lucia, St Vincent & Grenadines, Samoa, San Marino, Turks and Caicos Islands and Vanuatu.
Meanwhile, Switzerland has criticised OECD for naming it in the list of countries which have not substantially implemented the international tax standards.
The Swiss Bankers Association in an e-mailed statement to PTI said it regretted Switzerland has been named in the list.
The issue of tax havens had generated considerable political interest in India where certain parties are demanding the government take up with the West the need to repatriate money stashed away in Swiss banks and other havens.
Switzerland’s Federal Department of Finance in a statement on Thursday said President Hans-Rudolf Merz has taken note of the OECD list and added that it does not specify the criteria for the same.
“President Merz regrets this procedure. The list does not specify the criteria on the basis of which it was drawn up. Switzerland is not a tax haven,” the statement said.
Prime Minister Manmohan Singh in his opening remarks at the G-20 Summit had stressed on “sharing information and bringing tax havens and non-cooperating jurisdictions under close scrutiny.”
