Tax evasion aided by global inertia

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The BBC have a good article under the above title, here.

The discussion is on the Tax Justice Network report - the Price of Offshore Revisited.

As the article notes:

Tax evasion is rarely out of the headlines - especially with so many indebted governments keen to hunt down every tax dollar that is due.

At least $21tn (£13.5tn) of untaxed private wealth was invested in global tax havens in 2010, according to a report from the Tax Justice Network, a group of tax professionals which campaigns on the issue.

To put that into context - it is more than a quarter of the total GDP (gross domestic product) for the whole world - about the size of the US and Japanese economies combined.

But how credible is that figure?

James Henry, the author of the report, says: "We think these numbers are conservative and about 90% of offshore financial wealth is actually evaded tax.

"The amount that some developed countries would receive if all taxes were collected, would balance the foreign aid that those governments spend," he says.

To arrive at their figure, the Tax Justice Network looked at the offshore assets under management deposits and custody assets of the top 50 individual banks globally.

"We also built models of 139 developing countries going back 30 years - the most comprehensive models ever developed on unrecorded capital outflows and the accumulated value of all this offshore wealth," he explains.

The article does, of course, explore alternative views. The trouble is, those offering them have admitted to us that they have not read the report. Which does not help their credibility