Lost tax haven cash enough to end extreme poverty - twice over
- Published on Wednesday, 22 May 2013 10:12
- Posted by Vicki Mitchem
People using tax havens are depriving the world of more than $150 billion (£100bn) in lost revenue, enough money to end extreme poverty twice over, according to new figures published today by Oxfam.
A high proportion of this tax dodging is taking place on David Cameron and George Osborne's watch. Of the $18.47 trillion (£12tn) that Oxfam estimates is being held by individuals in tax havens around the globe, over a third - $7.18 trillion (£4.7tn) - is sitting in accounts in British Overseas Territories and Crown Dependencies. Despite the fact a deal was done earlier this month to get some of these tax havens to be more transparent and share tax information, and David Cameron's letter to Overseas Territories and Crown Dependencies this week, there is no tax deal on the table that will benefit poor countries who are struggling to reclaim the billions of pounds they are owed.
The international agency said it is a moral outrage and a scandal that this is taking desperately needed cash from poor countries as well as from citizens who are being hit by austerity measures closer to home.
Emma Seery, Oxfam's Head of Development Finance and Public Services, said: "These figures put the UK at the centre of a global tax system that is a colossal betrayal of people here and in the poorest countries who are struggling to get by, and put the government on the side of the privileged few. If they want to get on the right side of this debate, now is the time to take action.
"Britain's credibility is on the line; talking tough on tax, whilst continuing to usher a third of the world's wealth into UK tax havens, risks making a mockery of David Cameron's leadership at the G8 Summit in June."
Today in Brussels, David Cameron will attend an EU Summit where European Heads of State and Government will turn their attention to the unfair global tax system. The EU also needs to take serious action because two thirds of offshore wealth - $12.29 trillion (over £8 trn) - is sitting untaxed in European linked tax havens (including those linked to the UK). Oxfam is calling for a blacklist of tax havens, and agreement that EU member states will impose countermeasures sanctions against tax havens and those using them. The EU looks set to fail on this simple task.
Emma Seery said: "David Cameron and George Osborne continue to tour the world making promises to clamp down on tax havens, but so far they've done absolutely nothing to make tax deals work for poor countries.
"The UK and Europe cannot stand by and watch more people fall victim to the bite of austerity whilst billions is lost from the public purse on their watch. Unless the EU agrees a tax havens black list and clear sanctions, we'll get little more than hot air from leaders."
The $156 billion (£102 bn) of lost tax revenue estimated by Oxfam is just a fraction of total tax loss, as it only reflects the amount of tax individuals are neglecting to pay and doesn't include the tax dodged by companies that costs poor countries more than $160 billion (£105 bn) a year.
Oxfam is part of the Enough Food for Everyone IF campaign, which is calling on the G8 to make all tax havens join a multilateral agreement to share tax information, so that every country - especially the poorest - can tax companies and individuals fairly, and for an end to secrecy that hides the ultimate owner of assets held offshore so that they can avoid the taxman.