By Ronen Palan

Tax havens have existed since early twentieth century, and are used primarily, but not exclusively, for tax evasion and avoidance. Tax havens are used, however, for other purposes as well. Since the early 1960s, all the premier tax havens of the world have developed financial centres known otherwise as Offshore Financial Centres (OFCs). It is estimated that about a quarter of all international lending and deposits originate in these OFCs. The Bank of International Settlements (BIS) statistics of international assets and liabilities ranks the Cayman Islands as the fourth largest international financial centre in the world, while other well- known tax havens/OFCs such as Switzerland (7^th), the Netherlands (8^th), Ireland (9^th), Singapore (10^th), Luxembourg (11^th), Bahamas (15^th) and Jersey (19^th).