Christian Aid has staged a photocall to highlight the issue of company tax avoidance, which costs developing countries around $160 billion every year.

Christian Aid is calling on finance ministers attending G20 (4 – 5 September 2009) to address the issue of multinationals’ trade mispricing, which could cost the lives of 350,000 under-fives every year in developing countries.

There are various methods of trade mispricing, including a company’s subsidiary in one country selling goods at inflated prices to a subsidiary in a different country in order to move large sums offshore. These activities often involve the use of tax havens.

Another example is of separate companies agreeing secret deals to sell each other goods at prices that artificially depress profits and evade tax. According to the aid organisation, tax avoidance such as this can cost developing countries around US$160 billion (£98bn) in revenue every year.

Dr. David McNair, Christian Aid’s Senior Economic Justice Adviser, said: “In a communiqué earlier this year G20 countries committed themselves to proposing measures to counter tax evasion that would benefit everyone, not just rich countries.

“As the host of this meeting, Alistair Darling is in a unique position to lead his counterparts in delivering on the undertaking that they gave. Reform is vital. The revenues lost to developing countries at present could, if used according to current spending patterns, save the lives of 350,000 children under the age of five each year.”

Christian Aid is calling on the G20 group to consider forcing tax havens to make available details on all companies holding funds offshore, and to consider ensuring companies disclose the funds they make and hold in all countries.

The UK is chairing the G20 group this year. G20 is a group of Finance Ministers and Central Bank Governors from 19 countries – the European Union makes up the 20th member. The group’s aim is “to strengthen the international financial architecture and to foster sustainable economic growth and development”.

This week the ministers will be meeting to discuss a report by the Organisation for Economic Co-operation and Development (OECD) about tax transparency.