The State of Tax Justice 2023

CORRECTION – 23 August 2023: Due to a coding error, some data on 10 small jurisdictions was left out of the report’s tally on tax losses arising from global tax abuse. These jurisdictions are Anguilla, Cook Islands, French Guiana, Gibraltar, Guadeloupe, Guernsey, Jersey, Saint Martin, Taiwan, Wallis and Fortuna. Adding the missing data to the report’s analysis increases the estimate on how much tax countries lose to tax havens a year by 1.7 per cent, from US$472 billion a year to US$480 billion. Estimates on tax losses suffered or inflicted by these 10 jurisdictions are mainly small in comparison to other countries. The exceptions are the British dependencies Gibraltar, Guernsey and Jersey. The figures in the report have been updated to reflect the correction. More information on the correction is available here.

Countries are on course to lose nearly US$5 trillion in tax to multinational corporations and wealthy individuals using tax havens to underpay tax over the next 10 years, the State of Tax Justice 2023 warns. The future losses of public money would be equivalent to losing a year of worldwide spending on public health. The report urges countries to vote at the UN at this year’s end in favour of beginning negotiations on a UN tax convention at the UN General Assembly to avert the astronomic losses.

Key findings

• Countries are losing $480 billion in tax a year to global tax abuse.
• Of the $480 billion lost a year, $311 billion is lost to cross-border corporate tax abuse by multinational corporations and $169 billion is lost to offshore tax abuse by wealthy individuals.
• Lower income countries, which have historically had little to no say on global tax rules, continue to be hit harder by global tax abuse. While most annual tax losses are suffered by higher income countries ($433 billion), these losses are equivalent to 9 per cent of higher income countries public health budgets. Lower incomes countries’ tax losses ($47 billion) are equivalent to half (49 per cent) of their public health budgets.
• If countries stay the course followed for the past 10 years on international tax rules, countries will lose US$4.8 trillion over the next 10 years, the report estimates. In comparison, countries around the world collectively spent $4.66 trillion on public health in a single year.

Key recommendation

• To avert astronomic tax losses over the next 10 years, and free up trillions of dollars to support the off-track Sustainable Development Goals, the Tax Justice Network is urging countries to support moving leadership on global tax from the OECD to the UN, where global membership, public transparency and the UN’s human rights legal frameworks and technical expertise can provide a more viable forum for securing effective tax solutions