Calls for UK to take action on crown territories and dependencies
Image: Crown Copyright/Jay Allen
The amount of money stashed offshore by the 50 biggest U.S. companies jumped by $200 billion in 2015, according to a new report from Oxfam.
Using a secretive network of 1,751 subsidiaries in tax havens, the companies — including Pfizer, Goldman Sachs, Wal-Mart and Apple — secreted a total of $1.6 trillion offshore.
The Rigged Reform report also warns that big companies are pumping investment into political lobbying in order to win even greater tax breaks. And while the situation was bad in 2015, Donald Trump’s proposed tax reforms will skew the American tax system further, in favour of the wealthy and powerful.
The president has proposed slashing corporation tax from 35 to 15 per cent, enhancing the risk of a ‘race to the bottom’ in international tax policy. He has also proposed a protectionist Border Adjustment Tax, which is expected to harm poor consumers in the U.S. and poor communities around the world.
Additionally, Oxfam estimates that tax reforms proposed by President Trump and leaders in Congress could give the 50 top companies a windfall of between $312 and $327 billion on the profits they hold offshore.
Oxfam’s Head of Inequality Ana Arendar said: ‘These companies have deepened their use of tax havens and increased efforts to build influence to push for even greater tax breaks than they already have,’ commented Oxfam’s head of inequality, Ana Arendar.
“Corporate tax dodgers cheat the US out of approximately $135 billion in unpaid tax revenues every year and poor countries out of an estimated $100 billion annually.”
Oxfam specifically calls on the UK government to pass an amendment to its Criminal Finances Bill that would compel British Overseas Territories to publish registers revealing the owners of companies set up there.
“This report shows how tax avoidance continues to help the rich get richer at the expense of the poor. Governments, including the UK and the US, must work together to ensure all big businesses pay their fair share.”
Theresa May has repeatedly promised to build an economy that works for everyone. The opportunity seems fairly clear.Sign up to Left Foot Forward's weekday email for the latest progressive news and comment - and support campaigning journalism by making a donation today.