By Rob Young
World Business News, BBC World Service
Bermuda does not just attract surfers but also reinsurance companies
Dr Ewart Brown, the Premier of Bermuda, has said that it is being unfairly targeted by rich countries cracking down on so-called tax havens.
Bermuda has now signed a dozen agreements with western countries to share information for tax purposes.
Small nations with low or zero tax regimes have faced pressure since the onset of the financial crisis.
Asked if he felt Bermuda had been picked on, Dr Brown told the BBC World Service that was "absolutely" the case.
"We believe that this is essentially an onshore problem where offshore jurisdictions are being blamed," he said.
OECD white list
The Organisation for Economic Co-operation and Development (OECD) created a "grey list" of countries it deemed to be unco-operative with governments pursuing those suspected of evading tax.
Bermuda was initially on it but is now on the OECD's "white list" of countries which are co-operative on tax matters.
Bermuda has now "substantially implemented the internationally agreed standard" on sharing data, the OECD said.
Politicians in the United States are currently trying to close a "loophole" that allows reinsurance companies based in Bermuda to operate in the US.
Congressman Richard Neal, a Democrat from Massachusetts, told the US House of Representatives in July that such firms "strip their US income into tax havens, avoid tax, and gain a competitive advantage over American companies".
But Dr Brown believes the role of smaller, low-tax countries is misunderstood by bigger, richer nations.
"The financial activity of these companies in places like Bermuda is really beneficial to the countries onshore. In the US, for example, we commissioned a report which indicated there is great benefit to the United States in having companies based in Bermuda," he said.
"These companies are sufficiently strong financially to be able to pay claims after catastrophic events like [Hurricane] Katrina or 9/11. There's also an impact on jobs in the US that result directly from Bermuda-based companies," he added.
If the US attempt is successful, Dr Brown says his government will have to look at other ways of raising money, including trying to set up a gambling sector.
Time for tax
Bermuda's government fears that rich nations "could very well" try to force low- and no-tax countries to introduce or raise taxes to a level more acceptable to the OECD.
There is no income tax or VAT in Bermuda. Companies are charged an annual fee.
Asked whether Bermudians might have to start paying income tax, the premier said: "I wouldn't predict it but I wouldn't take it out of the realm of possibility. We'll survive. We'll do whatever we have to do."