Info Service on Finance and Development (Oct16/04)
10 October 2016
Third World Network
Rights: Eliminate tax haven secrecy in light of Bahamas leaks, say
Geneva, 6 Oct (Kanaga Raja) -- Several UN human rights experts have
called on governments to eliminate tax haven secrecy and offshore
tax evasion, in the light of the recent ‘Bahamas leaks'.
According to a media statement released here, this call has come following
the revelation of large-scale misuse of offshore accounts by financial
service providers and wealthy individuals in the Bahamas.
The call was made by the United Nations Independent Expert on foreign
debt and human rights, Mr Juan Pablo Bohoslavsky (Argentina), and
two members of the Human Rights Council Advisory Committee, Mr Obiora
Okafor (Nigeria) and Mr Jean Ziegler (Switzerland).
In their statement, the rights experts urged governments to act in
concert and establish a United Nations body working to eliminate tax
haven secrecy and offshore tax avoidance and evasion.
"While offshore structures can reflect legitimate business activity,
individuals are estimated to hold between US$7 and US$25 trillion
of wealth offshore, and the tax income lost by many countries could
total hundreds of billions of dollars each year," they said.
When individuals and corporations hide unreported assets abroad to
escape taxes or launder money, they are effectively stealing from
The proceeds from these illicit activities could and should be devoted
to funding public services, such as health care, housing, schools,
transportation infrastructure, social security, law enforcement and
courts, they said.
The rights experts recalled that illicit financial flows include funds
that, through legal loopholes and other artificial arrangements, circumvent
the spirit of the law, including, for example, tax avoidance schemes
facilitated by the use of offshore corporations.
"Thanks to the work of investigative journalists, the taxpaying
public is now aware of these immoral and illegal strategies, and understands
how tax abuse undermines economic, social and cultural rights."
States must prove they take seriously the interest of billions of
people all around the world who suffer from the erosion of public
services owing to massive fiscal misconduct, they said.
"It is time for the United Nations to take efficient measures
to prevent illegal activities of offshore companies located in tax
Worldwide tax justice and the successful fight against money laundering
will not be possible unless states cooperate to monitor and regulate
the fiscal activities of offshore companies, they underlined.
"Transparency and accountability for offshore financial activity
needs to be established. States must set uniform minimum taxation
floors, to prevent individuals and business entities from shopping
for the lowest possible tax rates."
Public disclosure of beneficial ownership information must be made
legally binding in all countries, and the financial transparency of
all banking jurisdictions should be ranked in an annual public report
by independent experts appointed by the United Nations. This ranking
should be based on a transparent set of criteria.
States and financial institutions should be required to automatically
share information with foreign taxation authorities for the purpose
of detecting offshore taxable income.
In this way, said the rights experts, the secrecy and anonymity that
enshrouds illicit offshore financial activity can be lifted, and money
intended to promote shared prosperity can be returned to its rightful
owners: the public. +