Large corporations continue to play cat and mouse with the tax authorities. Despite recent OECD initiatives to avoid shifting profits abroad (known as BEPS) and tax cuts in the US to repatriate capital (the Tax Cuts and Jobs Acts), the reality is that none of these instruments seems to take effect.
Because 37% of the profits of multinationals continue to travel abroad in search of low tax territories (or tax havens) to reduce (or even eliminate) the tax burden. We are talking about almost 1,000 million dollars of profits that are not subject to the control of the public coffers of the country where they were generated. To give you an idea, this percentage in the seventies reached 2% and a decade ago it was at 19%, with which the acceleration has occurred in recent years.
These are data that emerge from the EU Tax Observatory, co-financed by the European Commission and directed by the accredited academic at the University of Berkeley (USA) Gabriel Zucman. His research also shows that because of this avoidance, governments lose an average of 9% of corporate tax revenue.
His work shows that the profits that are hidden in tax havens in the last four years have grown at the same rate as the profits of multinationals, with what seems to be a consolidated practice. The schemes to shift profits are usually the usual ones: manipulating sales prices between subsidiaries within the same group; granting of loans at high interest rates between subsidiaries or payments for the use of rights to intangible industrial property assets (trademarks, patents, algorithms, etc.) between sister companies.
According to the EU Tax Observatory, the largest recipients of these fictitiously displaced benefits are the Caribbean islands, Singapore, Ireland and Switzerland. Likewise, Spain loses 18% of its income from corporation tax as a result of these tax tricks.
It is assumed that the EU had equipped itself with the appropriate tools to fight against these abuses, but the picture was complicated just a few days ago, after the Court of Justice of the EU (CJEU) accepted an appeal from Luxembourg in a ruling and declared illegal the public registry where the names of the real owners of the companies appeared. A system that, after the scandal of the Panama papers, made it possible to identify the true beneficiary of those complex corporate structures, which serve to hide the true owner of a firm.
Well, the sentence considers that in this way the right to privacy is violated. According to Maíra Martini, from the organization Transparency International, comments to this newspaper, the sentence has "a devastating impact", because now it also forces the prosecutor who is conducting investigations to resort to cumbersome international rogatory procedures. The Tax Justice Network platform speaks of "a return to the dark ages of dirty money" and points out that "this double standard allows laundering and avoidance".