The sharing of information on accounts in offshore financial jurisdictions like Bermuda is bringing in billions of dollars in tax revenue for the home countries of the account holders.

The island joined a global effort to improve transparency on matters of taxation by signing up to automatic exchange of information agreements.

“We really are moving closer to a world where there is nowhere left to hide,” Ángel Gurria, secretary-general of the Organisation for Economic Co-operation and Development, said.

The OECD reported last week that more than 90 jurisdictions participating in a global transparency initiative under the OECD’s Common Reporting Standard since 2018 have now exchanged information on 47 million offshore accounts, with a total value of around €4.9 trillion ($5.53 trillion).

Voluntary disclosure of offshore accounts, financial assets and income in the run-up to full implementation of the AEOI initiative resulted in more than €95 billion in additional revenue (tax, interest and penalties) for OECD and G20 countries over the 2009 to 2019 period. This cumulative amount is up by €2 billion since the last reporting by OECD in November 2018.

Automatic exchange of information has also caused deposits held offshore to fall, according to preliminary analysis by the OECD for a full report that will be published later this year.

Deposits held by companies or individuals in more than 40 international financial centres increased sharply over the 2000 to 2008 period, reaching a peak of $1.6 trillion by mid-2008.

These deposits have fallen by 34 per cent over the past ten years, representing a decline of $551 billion, the OECD dead, as tighter transparency standards took effect.

“A large part of that decline is due to the onset of the AEOI initiative, which accounts for about two thirds of the decrease,” the OECD stated. “Specifically, AEOI has led to a decline of 20 per cent to 25 per cent in the bank deposits in IFCs, according to preliminary data.”

Mr Gurria said there was now “an unprecedented level of transparency in tax matters, which will bring concrete results for government revenues and services in the years to come”.

“The transparency initiatives we have designed and implemented through the G20 have uncovered a deep pool of offshore funds that can now be effectively taxed by authorities worldwide,” Mr Gurria said.

“Continuing analysis of cross-border financial activity is already demonstrating the extent that international standards on automatic exchange of information have strengthened tax compliance, and we expect to see even stronger results moving forward.

“These impressive results are only the first stocktaking of our collective efforts.

Even more tax revenue is expected as countries continue to process the information received through data-matching and other investigation tools. We really are moving closer to a world where there is nowhere left to hide.”