Late last night news broke of another massive tax haven leak, this time from the Bahamas. Developing countries lose billions every year to corporate tax avoidance, money that could be spent on fighting poverty.
Nearly six months on from the Panama Papers leak, this huge leak of over 1.3 million files from a company registered in the Bahamas, a sunny tax haven in the Caribbean, reveals details of over 176,000 companies. The files highlight the scale of the problem, and once again demonstrate that the international tax system simply is not working.
Those with the means to do so are able to exploit loopholes and tax breaks, benefiting at the expense of some of the poorest people in the world.
The international tax system simply is not working.
It’s not just individuals who benefit from the global network of tax havens. Big companies can use offshore schemes to reduce their tax bills in the UK, and in some of the poorest countries in the world.
The IMF estimates that developing countries lose US$200 billion a year to corporate tax avoidance. Women and girls living in poverty pay the price as key public services like schools and hospitals are starved of funding.
The UK has the power to help change things. The government should champion a fairer international tax system. Demanding greater transparency from UK tax havens like the British Virgin Islands would be a good place to start.
How can you help change the global tax system?
The global tax system is not fit for purpose. It is outdated, unfair and it is not working for poor or rich countries. ActionAid is campaigning for this to change. We want the UK government to take a lead on reforming the global tax system to tackle tax dodging around the world.
ActionAid wants a tax system that works for poorer countries. They must be given the tools they need to ensure they can collect a fair amount of tax from big companies to invest in tackling poverty.
If you want to help put pressure on the government, join our campaign calling for fairer tax deals for developing countries.