Switzerland ranked at top in terms of fin secrecy
Switzerland has been ranked as the most financially secretive nation by an independent research group, which interestingly has also placed India above smaller jurisdictions such as Mauritius and Isle of Man in terms of financial secrecy.world Updated: Oct 04, 2011 20:59 IST
Switzerland has been ranked as the most financially secretive nation by an independent research group, which interestingly has also placed India above smaller jurisdictions such as Mauritius and Isle of Man in terms of financial secrecy.
The top three jurisdictions in terms of financial secrecy are Switzerland, Cayman Islands (2nd rank) and Luxembourg in that order, according to the Tax Justice Network (TJN).
As per the 2011 Financial Secrecy Index (FSI) that focusses on 73 jurisdictions, India is ranked 25th, much higher than Mauritius (32), Liechtenstein (34) and Isle of Man (36) -- the three places which are considered tax havens.
Ironically, many Indian citizens are estimated to have stashed black money in Switzerland, Mauritius and Isle of Man, among others.
"Switzerland is the grand father of the world's tax havens, one of the world's biggest financial centres, and one of the world's biggest secrecy jurisdictions or tax havens," TJN said.
About a third of the world's cross-border invested private wealth is managed in Switzerland, amounting to around $2 trillion, TJN said quoting Swiss Bankers' Association.
"Swiss banking is historically based on two main foundations: secrecy and political stability," it added.
TJN pointed out that the secrecy jurisdictions frame laws and systems which provide legal and financial secrecy to investors based elsewhere.
The index is based on qualitative and quantitative aspects, taking into account various factors such as particular jurisdiction's laws and regulations and international treaties.
Other jurisdictions in the top ten list are Hong Kong (4), the US (5), Singapore (6), Jersey (7), Japan (8), Germany (9) and Bahrain (10).
In the wake of 2008 financial meltdown, leaders from the influential G-20 countries had pledged to crack down on tax havens that help entities to park their unaccounted money.