Behind closed doors, a powerful industry has developed worldwide since the 1980s. Business groups assign profits to different subsidiary firms as though they were independent entities.
The six European tax havens (Luxemburg, Ireland, Netherlands, Belgium, Malta, and Cyprus) skim off 350 billion euros every year. Avoiding corporate taxes enriches a small group of persons. Taxes that are avoided must be compensated by higher taxation of households with lower incomes. A new loophole is always found.
Closing tax havens and ending tax competition is vital for a fairer tax system.