• By The Financial District

COUNTRIES LOSE $427B FROM TAX DODGING, REPORT REVEALS

Countries lose more than $427 billion in revenue each year from tax dodging by companies and wealthy individuals, according to groundbreaking new research by the Tax Justice Network (TJN), Will Fitzgibbon of the International Consortium of Investigative Journalists (ICIJ) reported.

The nonprofit published the “State of Tax Justice” report, and estimates that global tax losses could pay for the salaries of almost 34 million nurses around the world. The United States, itself a tax haven that strips money from other countries, lost enough revenue from its own residents and corporations to pay for the salaries of more than 1.1 million nurses paid an average US salary, TJN found.


“A global tax system that loses over $427 billion a year is not a broken system, it’s a system programmed to fail,” Alex Cobham, chief executive of the TJN, said at the report’s release. “Under pressure from corporate giants and tax haven powers like the Netherlands and the UK’s network, our governments have programmed the global tax system to prioritize the desires of the wealthiest corporations and individuals over the needs of everybody else.”


TJN says that its report is the first study to provide country-by-country estimates of losses due to corporate tax abuse and tax evasion. As the ICIJ explains, traditional definitions hold that tax evasion is illegal (a crime), but tax avoidance uses legal loopholes to reduce or avoid paying taxes. TJN found that multinational corporations avoid $245 billion while the world’s top 1 percent, who have been growing their wealth during the COVID-19 pandemic, avoid $182 billion.