Tax havens in the Caribbean are becoming stash grounds for Canadian companies
by Dawne Bennett
Caribbean Net News Barbados Correspondent
Friday, March 18, 2005
BRIDGETOWN, Barbados: According to a study
by Statistics Canada, between 1990 and 2003, the amount of money Canadian
corporations put into tax havens – the most popular of which are Barbados,
Ireland, Bermuda, the Cayman Islands and the Bahamas – has soared to
$88-billion from $11-billion. The study
entitled Tax Havens, An Evolving Taxation Issue has indicated that tax haven
countries “accounted for more than one-fifth of all Canadian direct investment
abroad in 2003, double the proportion 13 years earlier”.
A study last year by researchers at the
University of Quebec said Canada's major banks have used tax havens to avoid
paying $10-billion in taxes since 1991. The study found that the banks had a
total of 73 subsidiaries in tax haven countries such as Barbados and Cayman
Islands.
“We know that these types of countries are
characterized by low or zero taxation and moderate to light financial
regulation,” said François Lavoie, an analyst at Statscan, which undertook the
study. But the Canadian Bankers Association
has challenged the report, saying “the underlying premise is entirely
unfounded and misleading.” The association
added that there is nothing wrong with what the banks are doing.
Francis Wade, who runs Can-Offshore
Services, a Belize-based company that specializes in offshore banking, said
regulations in many countries have been tightened and he questioned figures
quoted in the study. Mr. Wade said most banks
in the Caribbean have less than $20-million in total customer deposits and
could not accommodate the sums indicated by the report.
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