Mapping Financial Secrecy

The economically active population of a place comprises "all persons of either sex above a specified age who furnish the supply of labour for the production of economic goods and services (employed and unemployed, including those seeking work for the first time) [...] during a specified time reference period." (OECD).

The percentage of tax actually paid in relation to the total income of the person paying the tax.

The Egmont Group consists of 108 financial intelligence units (FIUs) from across the world. Financial intelligence units are responsible for following “money trails” in efforts to counter money laundering and terrorist financing. The Egmont Group is intended to share understanding and promote collaboration amongst FIUs.

An unknown place in which it is assumed, but not proven, that a transaction undertaken by an entity registered in a secrecy jurisdiction is regulated.

The Enforcer oversees the actions of the trustees of a trust to ensure that those actions further the purposes stated in the trust deed / documents / instruments. It is commonplace in locations where trust enforcers are allowed that the trust instrument provides that the Enforcer has an absolute right of access to any information or document which relates to the trust, the assets of the trust or to the administration of the trust.The role of trust enforcer does three things. First it implies a lack of trust in the trustees. Second it makes clear that the trustees cannot and do not manage the trust because the enforcer clearly has power over them and therefore must in practice be the trustee. Thirdly, because the enforcer will in many cases be working on behalf of the trust settler there must be doubt whenever there is an enforcer in situ as to whether the settler has actually divested themselves of control of the assets held in trust, which is a pre-condition of a valid trust in most major jurisdictions but not in those places where enforcers are not allowed. Enforcers are not part of UK trust law.

A firm of accountants: the smallest member of the so-called Big 4 firms. Present in most secrecy jurisdictions.

The EU’s Code of Conduct for business taxation was established by its Council of Economics and Finance Ministers (ECOFIN) in December 1997. The Code is not a legally binding instrument but it clearly does have political force. By adopting this Code, Member States undertake to roll back existing tax measures that constitute harmful tax competition and refrain from introducing any such measures in the future ("standstill").The Code was specifically designed to detect only measures which unduly affect the location of business activity in the Community by being targeted merely at non-residents and by providing them with a more favourable tax treatment than that which is generally available in the Member State concerned. The criteria for identifying potentially harmful measures include: - an effective level of taxation which is significantly lower than the general level of taxation in the country concerned; - tax benefits reserved for non-residents; - tax incentives for activities which are isolated from the domestic economy and therefore have no impact on the national tax base; - granting of tax advantages even in the absence of any real economic activity; - the basis of profit determination for companies in a multinational group departs from internationally accepted rules, in particular those approved by the OECD; - lack of transparency. The Code has had considerable impact both within member states, but most especially on the tax havens affected associated with the UK or the Netherlands. This has been most clearly seen in the tax reforms imposed on the Crown Dependencies of Jersey, Guernsey and the Isle of Man.

The EU Savings Tax Directive was adopted to ensure the proper operation of the internal market and tackle the problem of tax evasion. It was approved in 2003 and came into effect on July 1st, 2005. It is an agreement between the Member States of the European Union (EU) that requires Member States to exchange information with each other about EU residents who earn interest on savings and investments in one EU Member State but live in another. Although the legal scope of the Directive does not extend outside the EU, certain jurisdictions – such as Switzerland, Liechtenstein, Andorra, Monaco, and San Marino, the UK’s Crown dependencies and Overseas Territories and their Dutch equivalents – have agreed to put in place legislation that supports the aims of the Directive. All Member States are ultimately expected to automatically exchange information on interest payments by paying agents established in their territories to individuals resident in other Member States. All Member States, except Belgium, Luxembourg and Austria, immediately introduced such a system of information reporting. Belgium, Luxembourg and Austria committed to a system of information reporting at the end of a transitional period, during which they levy a withholding tax at a rate of 15% for the first three years, 20% for the following three years, and 35% thereafter. They transfer 75% of the revenue of this withholding tax to the investor's state of residence. These three Member States are entitled to receive information from the other Member States. The investor in those places has an option to provide for preliminary information of his or her Member State of residence for tax purposes about the savings held abroad, or to permit the disclosure of the income to the same State, as an alternative to the retention or withholding tax.The Directive has a relatively broad scope that covers interest from debt-claims of every kind whether obtained directly or as a result of indirect investment via most collective investment undertakings and other similar entities. The European Commission on 13 November 2008 adopted an amending proposal to the Savings Taxation Directive, with a view to closing existing loopholes and better preventing tax evasion. The major weaknesses in the Directive are that it only applies to interest income and only to income paid to individuals and not to companies, trusts, foundations and other arrangements.

Artificial enclaves within states where the usual rules relating to taxation and regulation are suspended to create what are, in effect, tax havens within larger countries.