Tax Evasion Costs 1,000 Children's Lives A Day

Tue, 13 May 2008

The lives of 1,000 children are being lost every day to disease and poverty in poor countries because of illegal trade-related tax evasion, according to report by Christian Aid .

The charity insists the $160 billion (£82 billion) in tax revenue lost worldwide every year is costing the developing world greatly and says the companies which are using ‘false accounting’ to minimise their tax liability are the main culprits.

The report claims that if the funds were instead allocated according to current spending patterns, the lives of 350,000 children under the age of five – 250,000 of them infants – could be saved every year.

The amount of tax evaded through false accounting is almost one and a half times the amount of aid provided to the developing world every year and is in addition to the amounts lost through legal tax avoidance, the report notes.

Christian Aid has blamed tax havens for failing to tackle legal and illegal tax avoidance, and accused major accountancy firms of encouraging clients to take advantage of the lenient regimes.

The charity’s director Dr Daleep Mukarji said: "The abuse is so widespread and damaging that it is tantamount to a new slavery."

"The rich are getting richer on the backs of some of the most impoverished and vulnerable communities in the world."

Christian Aid has urged the Government to lead the charge for a crackdown on tax havens and to encourage multi-national companies to publish their accounts country by country.
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