One of Bermuda’s arguments in response is that, like any other jurisdiction, Bermuda has a “sovereign right” to set its own taxes, including the right to set corporate tax at 0%. The mere fact that Bermuda is a British Overseas Territory does not undermine this “sovereign right”, given the constitutional arrangements that have been put in place between Bermuda and the United Kingdom, enabling a certain level of self-government in Bermuda, without full independence (and without direct representation in the United Kingdom’s Parliament).
That is not to say that other taxes and Government fees are not payable in Bermuda: on the contrary, there are a whole range of taxes and Government fees payable by individuals and businesses alike. Indeed, the individual tax burden, once you take into account payroll tax, land tax, stamp duty, and taxes on imported goods is comparable, in many cases, to the individual tax burden in many other countries.
The irony of the situation is that Bermuda does, as a matter of basic and longstanding historical fact, compete to attract international business and international investment on the basis that, amongst other things, the Bermuda Government does not levy corporate tax locally on international businesses or asset-holding structures (even though those same businesses or structures may well be liable to pay tax in the various other jurisdictions where they operate).
Bermuda should be proud, therefore, of the fact that it sets a 0% corporate tax rate: this is one of its Unique Selling Points, even if attracts the label of a “tax haven” from certain critics.
What particularly annoys Bermuda about Oxfam’s comments is that they appear to overlook the enormous steps that Bermuda has taken (and continues to take) to implement and enforce high standards of regulation and international co-operation, in areas such as AML, ATF, KYC due diligence, proceeds of crime, bribery, corruption, fraud, tax information exchange, enforcement of foreign judgments and arbitration awards, assistance with foreign regulatory investigations and foreign judicial proceedings, and also with respect to the reporting of beneficial ownership and control and maintenance of corporate records.
In all these areas, Bermuda has a legitimate claim to be one of the better jurisdictions, rather than one of the worst jurisdictions, as Oxfam suggests. If Bermuda was deprived of its right to set its own corporation tax (as Oxfam seems to suggest), then there is a very high chance that Bermuda would eventually become one of the unfortunate jurisdictions to whom Oxfam and its donors may need to offer some charitable support and assistance.