IN MAY 2002, Stanley Works Inc., a Connecticutbased tool-making company, reincorporated in Bermuda, joining the recent list of U.S. firms (Fruit of the Loom, Ingersoll-Rand, and Tyco) “relocating” to escape taxes. The issue was prominently featured in the news and sparked a supposed outcry from politicians who claimed such moves were unpatriotic. Importantly, the issues of tax avoidance, tax evasion, as well as the concerns regarding offshore havens, date back generations. The Caribbean has been the focus in much of this history.

In 1937, President Franklin D. Roosevelt received a report on tax evasion from Treasury Secretary Henry Morgenthau, Jr. Roosevelt forwarded the document to Congress with this message: “Efforts at avoidance and evasion of tax liability [are] so widespread and so amazing both in their ...

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