8 April 2015
Accurate estimates of the size of the problem are difficult to obtain, but Oxfam estimates that at least $18.5 trillion is hidden by wealthy individuals in tax havens worldwide, whilst according to Global Financial Integrity from 2002 to 2011 developing countries lost US$5.9 trillion to illicit outflows, including $954 billion in 2011 alone. In a recently released report the UN Conference on Trade and Development (UNCTAD) estimates that developing countries lost around $100 billion per year in revenues due to tax avoidance by multinational enterprises
Governments everywhere are beginning to respond to rising community and political concern that multinational companies in particular are not paying their fair share of tax, but progress in addressing the issue is slow and uneven. Global Financial Integrity has for years recommended requiring multinational companies to publicly disclose sales, profits made, taxes paid, subsidiaries, and staff levels on a country-by-country basis as a necessary transparency measure to detect and deter abusive tax avoidance
A recent Australian report found that tax minimisation strategies employed by Australia's largest companies are costing the federal government more than $8 billion in lost revenue each year, prompting the establishment of a Senate committee to examine the effectiveness of Australia's current tax laws, the work of the Australian Tax Office and whether more transparency is needed to deter profit shifting and tax avoidance. The committee has commenced hearings this month.
The fight against tax injustice is one of the great battles of our age. Given that the core target in the fight is the rich and powerful, it will not be easy. Visit the Tax Justice Network website to learn more about what you can do.