The report was published in conjunction with the global union federation, Public Services International, as well as the Global Alliance for Tax Justice
“We welcome this report, which highlights yet again the need for Ireland to face up to the negative impacts of our tax policies on lower income countries,” said Maeve Bateman, Director of Financial Justice Ireland.
“As we all face the same pandemic, it is clear that we do so with different resources. There is an urgent need to reform the international tax system as this level of avoidance shows OECD reforms have simply failed to address the problem.”
The report was published in conjunction with the global union federation, Public Services International, as well as the Global Alliance for Tax Justice.
It claims to be the first study to measure thoroughly how much every country loses to both corporate tax abuse and private tax evasion.
Overall the analysis finds that countries are losing $427bn to what it describes as “tax havens” each year through international corporate tax abuse and private tax evasion.
Of this it alleges that multinational companies are responsible for $245bn of what is lost through aggressive tax planning, with $182bn lost to private tax evasion.
Countries with higher levels of income account for 98% of countries’ tax losses, it states, with lower income territories responsible for just 2%.
“Lower income countries lose more than half what they spend on public health every year to tax havens – that’s enough to cover the annual salaries of nearly 18 million nurses every year,” said Dr Dereje Alemayehu, executive coordinator at the Global Alliance for Tax Justice.
“The OECD’s failure to deliver meaningful reforms to global tax rules in recent years, despite the repeated declaration of good will, makes it clear that the task was impossible for a club of rich countries.”
The Irish Government has repeatedly denied claims that Ireland is a tax haven and is currently engaged in the OECD tax reform process.
It is trying to broker agreement on a new system for taxing multinational companies around the world that could see them all pay a minimum tax rate.
Top of the list of countries that inflicts the highest level of tax loss on other countries, according to the report, is the Cayman Islands.
It is responsible for $70bn of global losses or 16.5%, followed by the UK at $42bn or nearly 10% and the Netherlands at $36bn or almost 9%.
Collectively Europe accounts for nearly $187bn of the tax losses inflicted on others, with the Carribbean/American Islands responsible for $115bn and North America at $95bn.
“We must establish a UN tax convention to usher in global tax reforms,” said Dr Alemayehu.
“Only by moving the process for setting global tax standards to the UN can we make sure that international tax governance is transparent and democratic and our global tax system genuinely fair and equitable, respecting the taxing rights of developing countries.”