Our relationship with tax is complex. We all pay some tax, but we avoid doing so unnecessarily, if we can. National tax authorities devise taxes which are hard to avoid, so we use the word ‘avoidance’ to describe lawful ways to limit our liability to pay tax, but we say ‘evasion’ when we are describing the crime of lying to the tax authorities to escape proper tax payment. We use sporting terminology to describe this cat and mouse situation whether it is avoidance or evasion; we say tax ‘dodgers’ or tax ‘cheats’. The word dodge suggests something clever, artful, something we can even approve of; we do not say tax ‘criminals’. This is perhaps because, as an ordinary citizen it is hard to say if someone else is avoiding or evading tax. The topic is so complex we rely on the national authorities to make a finding on a case-by-case basis. National tax authorities are generally well equipped with laws and procedures to identify tax evasion within national frontiers.

Globalisation has created the phenomenon of international tax evasion. While this may always have been a problem, the scale of it now has earned a place in this book. The war on dirty money includes a vast amount of unpaid tax, which would have been paid to national treasuries in the past.

Campaigning organisation, the Tax Justice Network, estimates that countries are losing US$483 billion in tax a year to global tax abuse, US$312 billion of this tax loss is due to cross-border corporate tax abuse by multinational corporations and US$171 billion is due to offshore tax abuse by wealthy individuals. They recommend transferring tax convention responsibility from the Organisation for Economic Cooperation and Development to the UN, and the imposition of an Excess Profit Tax and a Wealth Tax.

The result of this lost tax revenue is catastrophic. Whole populations are deprived of public services – such as hospitals, schools, law and order, old age pensions and welfare support – because the tax revenue that would pay for these has not been paid. The lost tax – US$483 billion – should be added to the cost of attempting to prevent it from entering the international financial system – another US$210 billion. This because it is clear that the lost tax has entered the financial system and that it has been spent on something other than public services.