ABSTRACT
Tax havens play an increasingly important role in world financial markets, particularly in the Caribbean and Latin American regions. Tax havens thrive in a climate characterized by excessively strict bank secrecy, a lack of transparency and where countries are not prepared to cooperate to counter abuse. Over the last 30 years, we have seen many Caribbean islands move into offshore financial activities. This has had profound implications for the structure of their economies. It has also had profound implications for both developed and developing countries. This chapter examines the role of Caribbean tax havens, the response of the international community and sets out what is the current position of these jurisdictions in the light of the international initiatives aimed at curbing harmful tax practices.
