The Tax Justice Network (TJN) said states were depriving themselves of $89bn (£75bn) a year by allowing some of the world’s biggest companies anonymity over the way they use tax havens to conduct their tax affairs.
In its State of Tax Justice 2022 report, it called for an end to the concession made to multinational companies that they would not be named and shamed if they provided information about shifting profits into tax havens.
TJN said that on its calculations, governments could recoup 28% of the $316bn lost in cross-border “tax abuse” in 2021 if a loss of anonymity shone a light on the activities of all multinationals.
The UK legislated in 2016 to make country-by-country reporting publicly available but never used the power, and the idea was abandoned in 2020 by Rishi Sunak when he was chancellor. Last year, according to TJN estimates, the UK lost £27bn to multinational corporations underpaying tax.
Rachel Etter-Phoya, a senior researcher at the Tax Justice Network, said: “The OECD concession to corporate tax abuse is a political choice to turn a blind eye. Our governments patronise us with talk about making ‘tough decisions’ to deal with the global cost of living crisis, then choose to stay quiet about multinational corporations that have privately confessed to cheating the public out of billions in tax. They’re choosing to protect the cherries on the cakes of the richest corporations while people worry about putting food on the table. Our message to governments is clear: stop the cover-up, to lift living standards up..."