(18 November 2021) Countries are losing a total of $483 billion in tax a year to global tax abuse committed by multinational corporations and wealthy individuals – enough to fully vaccinate the global population against COVID-19 more than three times over.
These figures come from the 2021 edition of the State of Tax Justice report, a ground-breaking study on the scope and impact of international tax avoidance published by Public Services International, Tax Justice Network and the Global Alliance for Tax Justice.
The 2021 edition highlights how a small club of rich countries is responsible for the majority of tax losses suffered by the rest of the world, with lower income countries hit the hardest by this global tax abuse.
Over 99 per cent of global tax losses come from multinational corporations and wealthy individuals utilising abusive tax regulations and loopholes in higher income countries. The UK, Netherlands, Luxembourg and Switzerland are responsible for over half of the tax losses the world suffers (55 per cent), with OECD countries facilitating 78% of global tax losses. Despite these figures, no OECD country appears on the EU’s ‘tax haven’ blacklist – a handful of largely small island nations that are, according to the 2021 State of Tax Justice study, responsible for 1.1% of global tax abuse.
It cannot be ignored that, while high income countries lose more tax in absolute terms, the comparatively lower losses in lower income countries represent a greater share of their current tax revenues and public spending. With little of the say that their higher income OECD counterparts have on international taxation rules, these lower income countries are collectively losing the equivalent of almost half of their public health budgets (48%).
EPSU General Secretary, Jan Willem Goudriaan, called for the European Commission and Member States to strengthen measures to address tax avoidance. “The rich and corporations must pay their share to fund public services, to build our social protection systems and to invest in measures to address climate change. The pandemic shows us every day that our health and care workers and those in public services are relied upon to make the world go around. The tax avoidance of companies and the rich is immoral and a criminal act against Europe’s workers and people.”
The report can be found here in French, Spanish, Portuguese and English.
More information on EPSU’s tax justice work here