A worker stoops to pick asparagus in Ica, Peru. Despite the heat, she is completely covered, to protect herself from sunburn and from skin irritation caused by insecticides. (Photo credit: Christian Aid / Ana Cecilia Gonzales-Vigil)

Christian Aid, an international aid charity, has identified that tax evasion is costing developing countries US$160 billion annually (around £82bn) – a sum that could save the lives of 350,000 children lost to disease and poverty every year.

The charity’s report, Death and taxes: the true toll of tax dodging, reports on the issue of tax evasion – both legal and illegal – and has calculated that the sum lost to the practice is almost one and a half times the amount given as aid to developing countries every year.

Transnational corporations are identified as the biggest culprits of tax evasion, and are described as using ‘transfer pricing’, in which different parts of a company sell each other goods at manipulated prices, and ‘false invoicing’, where unrelated companies issue false invoices to disguise transactional profits.

Dr Daleep Mukarji, Christian Aid’s Director, said: “Children, along with millions of other people, are victims of a financial system in which poor countries are routinely denied the tax that is rightly theirs by transnational corporations and other businesses using methods both licit and illicit to lower their tax liability. This revenue would enable governments of developing countries to work their own way out of poverty rather than just relying on aid and debt relief.

“The abuse is so widespread and damaging that it is tantamount to a new slavery. The rich are getting richer on the backs of some of the most impoverished and vulnerable communities in the world.”

Christian Aid believes that the United Nations’ Millennium Development Goals (MDGs), which aim to halve world poverty by 2015, could already have been met “if only those who owe it would pay up”.

The charity is calling on the UK Government in particular to take the lead in pressing for change – the country owns 30 out of 72 of the world’s tax havens, which exist as homes for fugitive money.

To find out more about the charity, which works – regardless of religion – in more than 50 countries, visit: www.christianaid.org.uk ^[1].