Sir, – Tax avoidance by individuals and multinational companies is not without consequences, as Colm Keena rightly points out (Business This Week, June 29th). It results in the revenue shortfall being borne by small and medium enterprises and lower-income individuals, who are less able to employ expensive tax accountants to exploit legal loopholes to their advantage.
But the consequences of tax avoidance are felt more acutely when these schemes are used to deprive developing countries of revenue. Schemes using similar methods such as those used by comedian Jimmy Carr are regularly used by large multinationals to deprive poor countries of more money than they receive in aid each year. Christian Aid estimates that figure to be more than $160 billion every year – revenue that could be spent on schools, hospitals and life-saving drugs.
That some of these schemes are technically legal is beside the point. Companies operating in the developing world and benefiting from cheap labour costs, access to natural resources, and so on, have a moral duty to observe not just the letter of the law, but the spirit too. – Yours, etc,