By Stephanie Cook
Tax injustice has become a serious international issue that requires serious action and attention. Jubilee USA is extending its focus from debt relief to solving the root causes of unsustainable debt. This new wave in the Jubilee USA movement involves an active focus on Tax Justice and the damaging effects that unfair tax practices by multinational corporations have on the world’s poorest countries.
Large multinational corporations commit tax injustice when they store taxable funds in geographic
areas with low to no taxation.
These areas are called tax havens. Multinational corporations make use of these little treasure islands because it allows them to keep large amounts of profit, yet in doing so they rob the countries in which they operate of much needed tax revenues.
Taxation is vital in both low-income and high-income countries as it enables governments to provide basic infrastructure and services such as healthcare and education, which not only improve quality of life but also promote economic stability. It is estimated that the annual loss of taxable revenue caused by corporations using tax havens is $250 billion (Tax Justice Network, 2005). This figure is shocking when considering:
- It would cost $10 billion per year to achieve universal primary education.
- It would cost approximately $3.6 billion per year to provide anti-retroviral medication to the population of sub-Sahara Africa suffering from HIV/AIDs.
- It would cost an estimated $6 billion per year to battle malaria in African nations.