The main purpose of this paper is to analyze tax havens with an emphasis on the research of Panama as a tax haven and to analyze the Panama Papers affair. The paper consists of five chapters, and for the purposes of writing, data was collected from different secondary sources and methods of description, analysis, historical method, deductive method and compilation method were used. In order to better understand the topic, the concept of tax evasion, which is closely related to the topic itself, was analyzed in detail. Also, tax havens, their basic characteristics and the way of doing business in them are theoretically elaborated. The second part of the paper is devoted to the presentation of Panama as a tax haven, its historical background and its media exposure in 2016, when the Panama Papers affair took place. Tax havens are often associated with illegal activities, so this affair also reveals an immoral way of doing business in them. The conclusion is that it is necessary to tighten regulation and control over tax havens and increase the transparency of their operations. A key role in this have different international organizations such as IMF, OECD, FATF and the World Bank.