Pressure on investors who deposit money in offshore accounts has stepped up a further notch with the Isle of Man (IOM) independently announcing plans for the automatic exchange of tax information.

Tougher disclosure rules may soon be forced on offshore centres by the European Union and consequently this announcement by the IOM is seen as an attempt to make itself a front runner in international tax co-operation.

Earlier this year,  Switzerland and other favoured tax havens were forced to relax their bank secrecy laws opening the door to greater transparency.

The fast pace of  progress towards transparency was underlined at a high-level ministerial meeting in Berlin on Tuesday where Switzerland, Luxembourg and Austria agreed a communiqué threatening sanctions against unco-operative jurisdictions.

The pace of change is moving so quickly that Switzeland indicated it would achieve its target of meeting international standards on transparency by the end of the year. Discussions are taking place between the UK and Switzerland to amend their treaty and the UK hoping to reach an agreement with Liechtenstein next week.

The Isle of Man’s decision is seen as a postive step that reflects a realisation that levels of transparency will increase over time.

Following the collapse of Kaupthing, the Icelandic bank, the reputation of the IOM came under fire prompting Alistair Darling, chancellor, to describe the dependency as a “tax haven sitting in the Irish Sea” that came asking the government for help when there were problems.

Today, however, its reputation has improved as it strives to lead the way to greater transparency, signing 15 tax information exchange deals. This approach seems to be paying dividends as the IOM  was recently excluded from a “grey list” of tax havens published by the Organisation for Economic Co-operation and Development .