Canada losing billions of dollars to offshore tax havens
Governments are urged to crack down on tax havens (Getty)
Canada is losing $ 7.9 billion in tax havens, according to a new study slated for a G20 meeting this weekend.
The State of Tax Justice report found that this is equivalent to the annual salary of 100,000 nurses in Canada.
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"Offshore tax evasion by wealthy Canadians and big corporations is robbing governments of billions of dollars in lost revenue that could be used to pay for critical programs during the COVID-19 crisis," said Toby Sanger, director of Canadians for Tax Fairness.
The report also estimates that Canada is responsible for $ 10.5 billion in tax losses in other countries, and that poorer countries suffer the most.
According to the State of Tax Justice, corporate tax losses, including a race to the bottom on corporate tax rates, have an even bigger effect, estimated to be anywhere between $ 12.5 billion and $ 68 billion. For comparison, the PBO estimates that it's around $ 25 billion.
“Canada needs to step up its efforts to address corporate tax evasion, which is causing significant economic and social costs. It is the largest companies and richest individuals in the world who are also the greatest tax evaders. "
“Not only has it stolen hundreds of billions in revenue from governments around the world, but it has also created much greater inequalities and corporate concentrations, harming consumers, smaller businesses and our economy. Canada and other countries can no longer afford to allow these abuses, ”said Sanger.
Before the G20, Canadians for Tax Justice are calling on governments to take action. It calls for an excess profit tax for multinational corporations making more earnings as a result of the pandemic, and a wealth tax to fund the COVID-19 response and address long-term inequalities exacerbated by the crisis.
She would also like to see a UN tax convention to ensure global and genuine representation and to set multilateral standards for corporate taxation, tax cooperation and tax transparency. It also calls for public, country-specific reporting on the financial and tax returns of multinational companies
The report found that over $ 560 billion is being lost to offshore tax havens. The countries losing the most are the US, UK, Germany, France and Brazil.
"Now more than ever, we need to reprogram our global tax system to prioritize the health and livelihood of people over the desires of those who do not want to pay taxes," said Alex Cobham, executive director of the Tax Justice Network.
Jessy Bains is a Senior Reporter at Yahoo Finance Canada. Follow him on Twitter @jessysbains.
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