Pandemic does not stop evasion and money laundering
The six trillion euros of private fortunes hidden in tax havens are ten times the sum of all the plans and incentives agreed by the European Union to fight the catastrophic effects of the pandemic. A huge amount, which overlaps or overlaps with the 1.37 trillion euros UN figure for global money laundering. These figures are provided in the annual report of the UN High Level Panel on International Financial Accountability, Transparency and Integrity (FACTI), which was made public at the UN General Assembly.
The conclusion leaves little doubt: once again it is clear that the international tax system, whether through impotence or lack of political will, continues to be a sieve through which huge amounts of money escape, evading the corresponding taxation in the countries where they should. The volume of laundering is equivalent to the annual GDP of a country like Spain (also its current foreign debt), and that of the fortunes hidden in tax havens to the wealth generated annually and jointly by two countries of the size of Germany and France.
Far from being mitigated by the outbreak of the coronavirus, tax evasion appears to have increased during these months of confinement and slowdown in economic activity. This was highlighted by Dalia Grybauskaité, co-chair of the FACTI, during the presentation of the report, which also pointed, without naming them specifically, to "many banks actively collaborating in robbing the poorest".
The alleged fight against tax fraud and the flight of large fortunes to tax havens is therefore ending in a resounding failure, which has not been curbed by initiatives of intergovernmental organisations such as the Organisation for Economic Co-operation and Development (OECD) or others of a mixed nature such as the Financial Task Force (FATF), whose actions end up being diluted by "the lack of a truly supranational and neutral authority".
On the basis of this observation, these bodies, together with other platforms such as the Tax Justice Network (TJN), demand a genuine UN tax convention, "which ensures a fair and equitable global tax system for all". A demand which, on the 75th anniversary of the creation of the UN, would help to justify its continued existence. If the United Nations was created to avoid new wars, an objective that has long since been achieved, the truth is that fiscal inequality and injustice in a globalised world not only accentuates inequalities, but also favours and encourages the restlessness of countries that feel plundered by what we could call a neo-colonialism of the digital era.
It is precisely the digitalisation of the economy that makes it almost impossible to locate hidden money and track it down in order to get to know the real owners, protected by a tangle of anonymously owned companies, trusts or foundations, through which profits are transferred or capital evaporates. This architecture is the one denounced by Alex Cobham, TJN's CEO, among others, for whom "it is not that the global tax system is broken, it is that it is programmed to fail".
FACTI's document also deals with another chapter that transversally floods the world of large international businesses, bribes, which cause an exponential multiplication of additional costs. The fight to the death to conquer markets and obtain contracts has multiplied these practices, which end up subjecting all the applicants, since refusing to enter into that game is equivalent to being left out. The report goes so far as to quantify this multiplier effect: "a bribe of one million [dollars or euros] can easily create a damage of 100 million, in the form of "additional costs", which have to be passed on to the final work, but which go into certain private pockets.