Tax evasion via offshore accounts is costing the world economy hundreds of billions of dollars every year and is having a particularly damaging impact on developing countries, according to the Tax Justice Network, an organization dedicated to promoting transparency in international finance.

The figures are shocking: a third of all global assets held offshore beyond the reach of taxation, half of world trade passing through tax havens, USD 11.5 trillion held by individuals in tax havens, costing USD 250 billion in lost tax. The Tax Justice Network considers that “the fight against tax havens is one of the great challenges of our age.”

The organization describes tax havens a “blind spot” in international finance and aims to open the whole business of offshore tax evasion to scrutiny and raise public awareness of the nature and scale of the issue. The effect on developing countries is especially saddening; corrupt governments strip their countries of assets and put them in offshore accounts, strangling public funding and denying investment capital for public services.

“This helps capital flow not from capital-rich countries to poor ones, as traditional economic theories might predict, but, perversely, in the other direction,” says the Tax Justice Network.

Find out more about the Tax Justice Network and read the full report here.

Liam Lever, liam@romania-insider.com