In my humble opinion Bermuda offers way more than just a favorable tax regime when compared with other financial centers. In fact I believe many of the large insurance/reinsurance companies view the low tax environment as a negative for them. They do not like the pressure exerted on so called ‘tax havens’ because it harms their businesses through negative public perception.

I do not believe it is fair, or wise, to try to deflect criticism elsewhere as a form of defense, whether it be to our neighbors in the south or London. Those jurisdictions have their ‘Sovereign right’ to impose a tax regime that is appropriate to the financial security that they aspire to (I might refer to this in the context of Bermuda later…)

Bermuda has built up an enviable infrastructure and ecosystem for insurance/reinsurance companies to thrive. We have a regulatory environment that balances rigor with pragmatism and that is hard to achieve. Maintaining this environment is absolutely key, but it cannot be ignored that Bermuda’s ‘model’ is becoming outdated…

While it’s great for Bermuda to boast the statistics it does about the capacity it provides, my concern is that just having the companies and capital here is not sustainable for Bermuda. Our tax system is consumption based. It served us well in the past, but with ever increasing globalization and advances in technology there is less and less need for those companies to have large staff numbers in Bermuda – That is not good for Bermuda and it is a significant contributing factor (albeit not the only factor) in Bermuda’s increasing debt problem.

I genuinely believe now is the time that Bermuda should be looking ahead to the future and creating a new environment for business that serves the needs that we know our resident companies will face. I believe that should entail new corporate taxes. As I said earlier I believe that the majority of the insurers/reinsurers would be supportive of such a move, but it is important to stress that it should not be done to appease Bermuda’s critics, but instead to maintain our competitive edge.

I also think it would go along way to ensuring Bermuda’s fiscal health and sustainability. This is good for everyone, not least our resident companies who require a stable economy to operate.

I also think it would enable us to become more competitive from a cost standpoint by enabling us to remove the emphasis on payroll tax, which given the increases over the years has served to promote the ‘on shoring’ of human capital from our resident companies (some of the 500,000 jobs you referred to).

This is not a criticism of your article, but further elaboration of my opinion that the debate needs to go much further. I highly respect your opinion columns and I hope you can take an active role in positioning us to prosper in the long term.

- Corporate Tax is Good and Helps the Poor
- The Rich Stay Rich By Hiding Their Money Somewhere to Evade Tax

So Oxfam publishes things that reinforce those beliefs, irrespective of the facts. They don’t distinguish between the Bermuda and Panama business models, because their donors don’t have that level of sophistication.

Bermuda and all the offshore jurisdictions need to stop seeing themselves as rivals and start thinking as components of an industry threatened with extinction. They need to work together and spend millions on public relations to change the basic assumptions fuelling anti-offshore sentiment among Sanders types.

True.

It’s a point that I understand all too well. It informs and drives much of what I write about when writing about Bermuda’s economy.

Fact that is so clear to me? We – Bermudians – have to fight to retain what we have had, and now simultaneously fight to increase/enlarge what we now have.

I have long recognized that Bermuda is fighting – or needs to fight – a two front war. Something that even Sun Tzu warned against all of 2,500 years ago.

But that’s the only way that tiny isolated Bermuda will survive and re-prosper.

Larry Burchall

Tax haven- not acceptable. Low tax jurisdiction- acceptable. Its all in the lingua, I suppose.

Untaxed corporate profits, sounds like heaven(haven) for corporations. Taxed payrolls and license fees are the paltry tradeoff.

Tax avoidance is a common business “park” reality. Most do it.. Old news. Like Lar said, the City is a top ten haven so the spotlight is being misplaced on our Isle.

Bermy, like a silvatech, protects and insulates corporate profits. Non-issue, as numerous others legally avoid taxation too. Just MEDIA noise, I guess somebody’s got to take the blame. Sleight of hand, sleight of lingua, sleight of MEDIA.