MOSCOW (Sputnik) — The world’s poorest countries are losing billions of dollars in potential tax revenue each year as a result of tax dodging, a report by the UK-based Save the Children Fund revealed Monday.
Trade misinvoicing is defined as the practice of manipulating invoices for the export or import of goods or services to hide the value of products, secretly shifting profits in and out of countries, and thereby dodging the associated taxes.
According to the report, the 75 countries with the highest child and maternal mortality rates lose an estimated $78 billion a year due to trade misinvoicing, one example of illicit international financial transaction affecting tax revenue.
In very poor countries, the authors explain, the sums being lost are comparable to their national health budgets.
Kenya is among the worst hit countries, losing an estimated $435 million in tax revenue annually, a sum that could save more than 50,000 lives, according to the report.