Stronger and cleaner tax systems would help development, but there is much work to be done. Jeffrey Owens and Richard Parry , OECD Centre for Tax Policy and Administration
In 2008 a US senate subcommittee issued a report alleging that banks located in tax havens cost US taxpayers some $100 billion a year in lost revenue. That is a considerable leakage, especially in light of US laws, institutions and other mechanisms to help control tax evasion.
But if parking money offshore leaves an intolerable dent on the legitimate tax revenues of wealthy countries, just imagine the gulf it leaves in those of developing countries where the legal and institutional apparatus to stop tax evasion is far weaker. Tax abuse not only debilitates efforts to fight poverty but also weakens the fiscal base needed for sustainable economic development.
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