A TAXING ISSUE: Corporations are laughing at the idea of paying taxes as nearly $1 trillion goes offshore every year, researchers say.

About a decade ago, the world’s biggest economies agreed to crack down on multinational corporations’ abusive use of tax havens. This resulted in a 15-point action plan that aimed to curb practices that shielded a large chunk of corporate profits from tax authorities.

But, according to our estimates, it hasn’t worked. Instead of reining in the use of tax havens – countries such as the Bahamas and Cayman Islands with very low or no effective tax rates – the problem has only gotten worse.

By our reckoning, corporations shifted nearly $1 trillion in profits earned outside of their home countries to tax havens in 2019, up from $616 billion in 2015, the year before the global tax haven plan was implemented by the group of 20 leading economies, also known as the G-20.

When taxes are simple, transparent, and not too high, they generally get collected. If governments were more serious about generating revenues than creating carveouts for their friends, they’d simplify their tax codes rather than play these charades.