The Tax Justice Network has published a report with the above title. It is available here.
This publication details the findings of research into where 97 major European companies have their tax haven subsidiaries and compares this with the findings of the US report on this issue published last December.
The most important finding is by far the simplest: tax havens are an integral part of the business system. 99% of all European companies surveyed had a tax haven subsidiary. Most had many.
They are also a cancer that is helping destroy it from within, as John Kay suggested in the Financial Times this morning.
This is important: the effort to both expose the use of tax havens and to limit their use is driven by a desire to increase the well being of the people of the world. But that motive is not linked to anti-market sentiment. It is linked to a desire that we have efficient markets that work as well as possible to deliver maximum well-being for all participants, wherever they are, and that we can prove it. That is not possible when tax havens are part of the system, as I have argued elsewhere.
This survey has shown just how far we are from understanding how our markets work, how money flows, and why businesses are structured as they are. We cannot deliver optimal results in that case.
The case for reform of accounting so we know who is where, and of tax havens so that the massive market imperfections they create are eliminated is compelling.
I hope the G20 are up to tackling the issue.
Secrecy jurisdictions are places that intentionally create regulation for the primary benefit and use of those not resident in their geographical domain that is designed to undermine the legislation or regulation of another jurisdiction and that, in addition, create a deliberate, legally backed veil of secrecy that ensures that those from outside the jurisdiction making use of its regulation cannot be identified to be doing so.
For more information see http://www.taxjustice.net/cms/upload/pdf/Country-by-country_reporting_-_080322.pdf
NB: New report version posted 27-4-09 changes some of the conclusions in the text due to clarifications in the Dutch source data
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