Financial Crime World

Global Tax Abuse Costs World $483 Billion Annually, UK Network of Offshore Hubs Contributes to Loss

A new report by the Justice Network’s State of Tax Justice 2021 has revealed that the world loses a staggering $483 billion annually due to tax abuse committed by multinational corporations and wealthy individuals.

The Impact of Tax Abuse

  • Global tax abuse costs the world $483 billion annually
  • The UK’s network of Overseas Territories and Crown Dependencies contributes to this loss, inflicting a tax loss of $87.9 billion on the rest of the world through enabling private tax evasion
  • Cross-border corporate tax abuse increases this figure to $189 billion

The Role of the UK in Tax Abuse

  • The UK itself loses $25 billion annually due to private tax evasion enabled by other countries
  • This figure increases to $52 billion when including cross-border corporate tax abuse
  • The UK’s network of Overseas Territories and Crown Dependencies has been criticized for enabling tax evasion and other financial crimes

UK’s Offshore Network of British Secrecy Hubs

  • The Financial Secrecy Index 2022, published by the Tax Justice Network, ranks jurisdictions based on their level of financial secrecy
  • The US has risen to the top of the list as the world’s leading secrecy jurisdiction, despite efforts by President Joe Biden to address global financial secrecy
  • The UK’s network of Overseas Territories and Crown Dependencies is a major contributor to global financial secrecy

Call for Urgent Action

The report calls for urgent action from governments and international organizations to address these issues and ensure that everyone contributes their fair share towards public finances. The Justice Network is urging policymakers to take immediate action to:

  • Strengthen tax laws and enforcement
  • Improve transparency and accountability in the financial sector
  • Promote international cooperation to combat tax evasion and avoidance

Conclusion

The report’s findings are a stark reminder of the need for urgent action to address global tax justice issues. By working together, governments and international organizations can ensure that everyone contributes their fair share towards public finances and helps build a more equitable society.