What are the effects of secrecy jurisdictions?

Tax Research has clearly outlined the harmful effects of secrecy jurisdictions. According to their briefing, secrecy jurisdictions facilitate illicit financial flows, to which the developing world loses an estimated US $1 trillion a year. By assisting illicit trading and promoting opacity, they undermine free trade and in seeking to push down tax rates – decided upon by elected governments – they also undermine democracy. Finally, the financial opacity created by the use of secrecy jurisdictions diminishes trust in markets and damages market efficiency.

To read the briefing in full: http://www.taxresearch.org.uk/Documents/Secrecyjurisdiction.pdf