Japanese economists urge G7 ministers to eradicate tax havens

26 May 16

Japanese economists and experts have urged G7 governments to take the lead on ending tax havens as the countries’ leaders convene in Japan today.


Panama City, Panama

Panama City, Panama. A recent leak of a trove of documents from Panamanian law firm Mossack Fonseca revealed how the world's rich and powerful use tax havens to shirk their dues, putting tax avoidance high on the agenda.


The 47 individuals added their name to an open letter already signed by more than 300 leading economists from around the world in hopes of convincing G7 leaders to make progress at the two-day meeting.

Japan’s finance minister, Taro Aso, has already said the G7 summit in Ise-Shima should be an important milestone in the fight against tax evasion, with world leaders under increasing pressure to put an end to the practice.

Iwahito Katsui, a distinguished economist and professor emeritus at Tokyo University, said: “People say that when 10 economists are in a room they will come up with 11 different policy recommendations.

“Yet on the issue of tax dodging economists are speaking as one. They want to see an end to tax havens which allow wealthy individuals and multinational companies to hide their money from the tax authorities.”

The original letter, coordinated by Oxfam, was published earlier this month in the wake of the Panama Papers – the leak of more than 11 million documents from a Panama-based law firm that unveiled how the rich and powerful have dodged tax using offshore companies based in tax havens.

Its signatories include Nobel Prize winners, professors from the world’s top universities and former International Monetary Fund staff.

They urged leaders to use the Anti-Corruption Summit, held in London earlier this month, to end the era of tax havens, which they said have no economic justification, distort the global economy and serve to increase inequality.

Earlier this week, Oxfam also published an analysis arguing that the Netherlands, the country holding the European Council presidency and therefore leading the union’s anti-tax avoidance efforts, is a “top European Union tax haven”.

Based on European Commission data, the report identified the Netherlands as the worst offender when it comes to laws that facilitate tax avoidance, followed by Belgium and Cyprus.

Oxfam’s analysis came ahead of a meeting of EU finance ministers yesterday, where they failed to reach agreement on new rules to clamp down on multinational companies’ tax dodging.

The G7 meeting takes place today and tomorrow in Japan.


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