Tax dodging - who pays?
Tax is a key weapon in the fight against poverty. Taxes paid by companies and individuals enable governments to fund vital public services such as health care, education, clean water and electricity, and to finance anti-poverty programmes throughout the world. So when multinational corporations and wealthy individuals fail to pay the tax they owe, it's the poor who pick up the bill.
Companies now see tax dodging as a legitimate part of their business operations even though companies benefit directly from education, infrastructure, healthcare etc that is provided by the state. The cost of tax dodging is staggering! Developing countries lose an estimated £250 billion every year as a direct result of corporate tax dodging - money which could be used to reach the UN's Millennium Development Goals several times over.
And it's not just developing countries that lose out. Britain also loses up to £120 billion a year through tax dodging and uncollected tax. That's enough to double funding for the entire NHS. Alternatively, the same sum could cover the full state pension, eradicate student fees and enable Britain to reach the UN international aid target of 0.7% of gross national income overnight.
| War on Want is a member of the Tax Justice Network, which promotes tax justice and tax cooperation and resists tax avoidance, tax evasion and tax competition. Visit the Tax Justice Network's external website to learn more. |
One popular way of dodging tax is to register companies tax havens, that allow companies to get away with paying minimal tax, if any. Tax havens thrive on 'secrecy' and so place little or no reporting requirements on companies, allowing them to keep secret the true sums they should be paying in tax. This then denies vital revenue to the countries in which those companies have made their profits.
War on Want believes it's time to put an end to this corporate tax scandal. And justice, like charity, begins at home. The UK is a major part of the global problem of corporate tax dodging. We believe it should be part of the solution.
