By CTHI From Tax Justice Network

The Corporate Tax Haven Index ranks the world’s most important tax havens for multinational corporations, according to how aggressively and how extensively each jurisdiction contributes to helping the world’s multinational enterprises escape paying tax, and erodes the tax revenues of other countries around the world. It also indicates how much each place contributes to a global”race to the bottom” on corporate taxes.

This index was launched on 28 May, 2019 and it will be published every two years.

The Corporate Tax Haven Index complements our Financial Secrecy Index, which ranks tax havens according to financial secrecy.

The menu on the left provides more information on how the index works, and provides context.

Click here for the full 2019 ranking.

What is the problem?

In rich and poor countries, multinational corporations rely on a wide range of public services to support their activities: the health and education systems that underpin their workforces and their intellectual property; the roads and other infrastructure that they use to ship their goods and services; or the public courts and police forces that protect their property and their rights. All these things need to be paid for — largely through raising tax. When multinationals use corporate tax havens to escape paying their contributions to these public goods and services, they are free-riding off the taxes paid by other people — you and me. When Amazon, arguably the world’s biggest monopolist, pays minus one percent in US federal corporate taxes, it’s clear that the international tax rules are rigged. Corporate tax havens are the heart of the problem.

This cheating, whether “legal” or not, generates great harm. First, it undermines support for democracy and for markets, by fostering a widespread (and correct) sense that there is one set of light, low-tax rules for large and powerful corporations and wealthy individuals, and a harsher set of rules for everyone else. Second, it generates enormous economic and political inequalities, by shifting the burden of tax away from the wealthy shareholders of corporations and onto the backs of ordinary people, who must either suffer higher taxes themselves or reduced public services. In this sense, corporate tax cuts are best viewed as a burden — a burden that falls most heavily on women and on disadvantaged minorities. Third, by helping large players to out-compete and kill their smaller, more locally based rivals on a factor — tax cheating — that has nothing to do with genuine productivity or innovation or wealth creation, this distorts markets and contributes to the rapid rise of monopoly and market power. Fourth, it damages innovation, by rewarding corporate managers for turning their attention away from building better products and services, and towards tax minimisation and financial engineering.  Fifth, it worsens financial instability by boosting too-big-to-fail banks and disproportionately rewarding highly profitable risk-taking at taxpayers’ expense, over more mundane industrial and other wealth-creating activities. Sixth, for all these reasons and more, it creates “Robber Baron” recessions, and reduces economic growth.

For more on this story go to; https://corporatetaxhavenindex.org/