Let's take Barbados as an example, because I've been to that office on a number of occasions.
You would have seen in the press over the last couple of days, I think, talk about tax havens and that Barbados was the number one on the list as far as foreign investment going into Barbados. That's not individuals in Barbados, that's multinational corporations, Canadian based, going into Barbados. The reason they do that is because Canada has a tax treaty with Barbados. Barbados enjoys a tax treaty with Canada, just as Luxembourg does.
A multinational in Canada can take some of its business operations, not that does business in Canada but does business around the world, and they can put it in Barbados. The profits earned in that particular jurisdiction are taxed at a rate of 2.5% instead of the 25% they would have to pay if it were profit earned in Canada.
The Canadian government has, by policy, allowed its multinationals, when they expand globally, to use jurisdictions like Barbados to finance their international expansion, as long as they meet the tests around substance, etc. And for those of you who have been to Barbados, you'll have seen a lot of signs of Canadian businesses that are actually operating there.
Why does Barbados allow that? Well, Barbados doesn't have a lot of natural resources. They're not close to anybody. The only way they're going to get jobs or create a finance industry or whatever is to create an advantage. That advantage is a very low tax rate that Canadian businesses take advantage of. Ireland does the same thing.