Tax evasion and optimization costs countries around the world $ 427 billion each year.
For the first time, the price of this game of hide-and-seek between multinationals, the super-rich and national tax authorities has been accurately assessed by the NGO Tax Justice Network, in its annual report, published Friday, November 20. .
Different estimates of the tax revenues lost due to remittances to tax havens - ranging from $ 90 billion to $ 650 billion annually - have been circulating for years.
But the figures published in this new study represent the most precise assessment to date because they are based on a small financial revolution obtained after a decade of lobbying by associations fighting against tax evasion.
France loses 20 billion dollars a year
The Organization for Economic Co-operation and Development (OECD) agreed to publish for the first time, in July 2020, tax data, country by country, allowing the share of profits of multinationals that escape tax to be deducted in States where they operate.
These data are still incomplete: they are anonymized - that is to say that we do not know, for example, how much Google, Facebook or Apple manage to save by juggling the Irish or Luxembourg tax rules -, and some countries important, like Germany, refused to provide their figures or did so incompletely.
But, “before that, it was total desert, and now we have taken a giant step forward thanks to this information which allows us to have a good overview”, explains Markus Meinzer, specialist in tax evasion. for Tax Justice Network, contacted by France 24.
These new data show that corporate tax optimization costs governments much more ($ 245 billion in lost tax revenue each year) than tax evasion by private taxpayers, which is estimated at $ 182 billion per year by corporations. authors of the study.
The precision of the OECD figures even made it possible to have an estimate of the money lost for each country in the world.
Large fortunes and multinationals would thus deprive the French tax authorities of 20.2 billion dollars thanks to financial arrangements, legal or not.
In absolute terms, the United States, Germany and the United Kingdom suffer the most from these practices.
But the big losers are clearly the poor or developing countries.
Thus, Sudan or the Central African Republic lose the equivalent of more than 25% of their total tax revenue each year due to optimization and tax evasion, while for France or Germany, it is barely 3%.
“The Axis of Tax Avoidance”
The tribute paid by the least advanced nations appears all the heavier to the authors of the report as “the main culprits of this system are the rich countries”, affirms the specialist in tax evasion.
The study comes, in fact, to wring the neck of one of the main clichés on tax havens: that they are essentially small islands lost in the Caribbean or Oceania.
The four countries that make it easier for multinationals and big money to abuse tax rules are rich nations nestled in the heart of Europe.
The United Kingdom with its “web of small islands”, like the Cayman Islands, is at the top of this ranking, followed by Luxembourg, Switzerland and the Netherlands.
These countries, which the authors of the study dubbed the “Axis of Tax Avoidance”, are responsible for nearly 45% of all tax revenue lost by all countries of the world due to optimization. multinational corporation tax.
Besides that, the states that Europe has inscribed on its famous blacklist of tax havens do not play in the same division.
These twelve “non-cooperative tax jurisdictions”, essentially made up of small islands such as Samoa, Trinidad and Tobago, or even Vanuatu, “are only responsible for less than 2% of tax revenue losses”, underlines Markus Meinzer.
For the authors of the study, this list illustrates the hypocrisy of the European position in the fight against tax evasion.
Tax multinationals?
“Such a global tax system that costs states $ 427 billion is not only flawed, it is programmed to fail.
Programmed by governments, under pressure from multinationals and powerful nations that take advantage of it, to prioritize the interests of the richest to the detriment of the rest of the population ”, regrets Alex Cobham, director of the NGO Tax Justice Network in conclusion of the report.
A system whose consequences “are even more dramatic for developing countries in this period of the Covid-19 pandemic”, adds Markus Meinzer.
The tax revenues that these countries do not collect each year because of these practices “correspond to more than 50% of their combined health budgets”, note the authors of the study.
In other words, “the rich countries which favored these abuses of tax rules are partly responsible for the chronic underinvestment of poor countries in health systems which means that they are much less well equipped to cope today. 'hui to the health crisis ”, regrets Markus Meinzer.
“The health professionals who find themselves on the front lines in these countries in under-equipped hospitals must take the applause and encouragement of politicians as insults.
This crisis must make decision-makers aware that we must finally make multinationals and the very rich pay to have public services that function properly all over the world ”, summarizes Rosa Pavanelli, secretary general of Public Services International, a international union of public sector workers, in response to the publication of this report.
For the authors of the report, two emergency measures would bring a little tax justice in the management of the health crisis.
They advance, on the one hand, the idea of a tax on the extraordinary profits made by certain multinationals during the pandemic.
One way of targeting Amazon, for example, whose sales have exploded since the start of the health crisis and which is known for its aggressive tax optimization policy.
On the other hand, they propose the introduction of a one-off wealth tax which would be used to finance a “Covid-19 fund” to help the poorest countries to cope with the health crisis.
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