Tax avoidance costs developing countries €460m: Oxfam Novib

Developing countries are missing out on some €460m a year in income because big companies use letterbox firms to avoid paying tax there, according to Dutch aid group Oxfam Novib.

Brewers, oil firms and mining companies are happy to do business in Africa but use complicated constructions to reduce their tax bills, the organisation’s research, quoted by RTL news, shows.

This is a missed opportunity, because if poor countries had more tax income, they would be less dependent on aid. The Dutch government spends some €4bn a year on aid, but that is being reduced this year by €1bn because of spending cuts.

Oxfam Novib puts the shortfall in tax income at roughly €460m but wants the national audit office to do its own investigation to come up with more accurate figures, RTL said.

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