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| Boilerpipe Text | This article is about the legal reduction of taxes. For the illegal equivalent, see
Tax evasion
. For the refusal to pay tax, see
Tax resistance
.
Tax avoidance
is the legal use of the
tax
regime in a single territory to one's own advantage to reduce the amount of tax that is payable. A
tax shelter
is one type of tax avoidance, and
tax havens
are jurisdictions that facilitate reduced taxes.
[
1
]
Tax avoidance should not be confused with
tax evasion
, which is illegal.
Forms of tax avoidance that use legal tax laws in ways not necessarily intended by the government are often criticized in the
court of public opinion
and by
journalists
. Many
businesses
pay little or no tax, and some experience a
backlash
when their tax avoidance becomes known to the public. Conversely, benefiting from tax laws in ways that were intended by governments is sometimes referred to as
tax planning
.
[
2
]
The
World Bank
's
World Development Report
2019 on the future of work supports increased government efforts to curb tax avoidance as part of a new
social contract
focused on
human capital
investments and expanded
social protection
.
[
3
]
"Tax mitigation", "tax aggressive", "aggressive tax avoidance" or "tax neutral" schemes generally refer to multiterritory schemes that fall into the grey area between common and well-accepted tax avoidance, such as purchasing
municipal bonds
in the United States, and tax evasion but are viewed by some as unethical, especially if they are involved in
profit-shifting
from high-tax to low-tax territories and territories recognised as tax havens.
[
4
]
Since 1995, trillions of dollars have been transferred from
OECD
and
developing countries
into tax havens using these schemes.
[
5
]
Laws known as a General Anti-Avoidance Rule (GAAR) statutes, which prohibit "aggressive" tax avoidance, have been passed in several countries and regions including Canada, Australia, New Zealand, South Africa, Norway, Hong Kong and the United Kingdom.
[
6
]
[
7
]
In addition,
judicial doctrines
have accomplished the similar purpose, notably in the United States through the "business purpose" and "economic substance" doctrines established in
Gregory v. Helvering
and in the United Kingdom in
Ramsay
. The specifics may vary according to jurisdiction, but such rules invalidate tax avoidance that is technically legal but is not for a business purpose or is in violation of the spirit of the tax code.
[
8
]
The term "avoidance" has also been used in the tax regulations
[
examples and source needed
]
of some jurisdictions to distinguish tax avoidance foreseen by the legislators from tax avoidance exploiting
loopholes
in the law such as
like-kind exchanges
.
[
9
]
[
10
]
[
correct example needed
]
The
US Supreme Court
has stated, "The legal right of an individual to decrease the amount of what would otherwise be his taxes or altogether avoid them, by means which the law permits, cannot be doubted".
Tax evasion, on the other hand, is the general term for efforts by individuals, corporations,
trusts
and other entities to evade taxes by illegal means.
According to
Joseph Stiglitz
(1986), there are three principles of tax avoidance: postponement of taxes, tax arbitrage across individuals facing different tax brackets, and tax arbitrage across income streams facing different tax treatment. Many tax avoidance devices include a combination of the three principles.
The postponement of taxes is the present discounted value of postponed tax is much less than of a tax currently paid. Tax arbitrage across individuals facing different tax brackets or the same individual facing different marginal tax rates at different times is an effective method of reducing tax liabilities within a family. However, according to Stiglitz (1986), differential tax rates may also lead to transactions among individuals in different brackets leading to “tax induced transactions”. The last principle is the tax arbitrage across income streams facing different tax treatment.
[
11
]
Anti-avoidance measures
[
edit
]
An anti-avoidance measure is a rule that prevents the reduction of tax by legal arrangements, where those arrangements are put in place purely to reduce tax, and would not otherwise be regarded as a reasonable course of action.
Legislative measures
[
edit
]
Two kind of anti-avoidance measures exist; General Anti Avoidance Rules (GAAR) and Specific Anti Avoidance Rules (SAAR). The GAAR implies a set of generic anti-avoidance rules, while SAAR targets a specific avoidance practice or technique. Also, there is a set of bilateral measures pursued thorough treaties or double taxation agreements (DTAAs), this can be done via various clauses.
[
12
]
Judicial anti-avoidance measures
[
edit
]
Courts around the world have played an important role in developing SAAR and GAAR measures. But the two guiding principles in judicial anti-avoidance are business purpose rule and substance over form rule. The business purpose rule states that the transaction must serve as a business purpose. Which means that mere tax advantage cannot be the main business purpose. On the other hand, the substance over form principle is wider than the business rule and it is defined by the OECD as the ‘prevalence of economic or social reality over the literal wording of legal provisions’ (Ostwal, T.P.; Vijayaraghavan, Vikram 2010).
[
12
]
EU Anti-Tax Avoidance Package
[
edit
]
The Anti-Tax Avoidance Package is part of the European Commission's agenda as an effort to implement a more effective corporate taxation in the European Union. This package was implemented in 2016 and offers measures to prevent aggressive tax planning and encourage of tax transparency among others. The Anti- Tax Avoidance Package counts with an Anti-Tax avoidance directive, recommendation on Tax Treaties, revised administrative cooperation directive and communication on external strategy.
[
13
]
Anti-Tax Avoidance Directive (ATAD)
: On 20 June 2016 the European Council adopted the Directive (EU) 2016/1164 which contains five legally binding anti-abuse measures that should be applied as common forms of aggressive tax legislations. The member States must have applied these measures as from 1 January 2019. ATAD contains the following five anti-abuse measures: 1. Interest deductibility, to discourage artificial debt arrangements which are design to minimise taxes, 2. Exit taxation, for preventing the avoidance of taxes when companies are re-locating assets, 3. Incorporation of the GAAR for disregarding of non-genuine arrangements, 4. Controlled Foreign Company Rule (CFC), to deter that the profit is transferred to a low or no tax country, 5. Switchover rule, to prevent double non-taxation.
[
14
]
Anti-avoidance measures by country
[
edit
]
Australia has a strong tax regime regarding avoidance which applies to large corporate groups, underpinned by the General Anti- Avoidance Rule (GAAR) adopted since 1981 with the Income Tax Act.
[
15
]
The multinational anti-avoidance law (MAAL) is an extension of Australia's general anti-avoidance rules. This aims to make multinational enterprises pay their fair share of tax of the profits received and earned in Australia
[
15
]
Since 1980s there have been six major tax reforms in the US. The first one, in 1981, introduced a variety of tax loopholes. With this, the tax shelter industry boomed, giving rise to a demand for tax reform. The 1986 tax reform was the most accurate attempt at reducing tax avoidance, but then the next reforms of 1993 and 1997 opened new opportunities for tax avoidance and increased incentives of tax avoidance.
[
16
]
The 1986 tax law reduced the demand for tax shelters and the opportunities for tax avoidance by constricting the gap between regular rates and the minimum tax rates. Lowering the top marginal rates, restricting the ability to use losses on just one type of income for balancing gains on other income and finally by taxing capital gains with full rates. There was another tax act in 1993, in which the alternative minimum tax rates were increased, also the regular rates, and an increase in the absolute gap for upper-income people. In the 1997 act, a gap between the rates at which capital gains and ordinary income was introduced to all taxpayers. During the 2001 and 2003 tax acts introduced more opportunities for tax avoidance because the gap between the capital gains and ordinary income tax remained the same as both rates were reduced by 5%. Finally, in the 2013 tax act, increased the tax on capital gains and ordinary income to 20 and 39.6% respectively.
[
16
]
Country of residence
[
edit
]
A company may choose to avoid taxes by establishing their company or subsidiaries in an
offshore jurisdiction
(see
offshore company
and
offshore trust
). Individuals may also avoid tax by moving their
tax residence
to a
tax haven
, such as
Monaco
, or by becoming
perpetual travelers
. They may also reduce their tax by moving to a country with lower tax rates.
However, a small number of countries
tax their citizens on their worldwide income
regardless of where they reside. As of 2012
, only the United States and
Eritrea
have such a practice, whilst Finland, France, Hungary, Italy
[
citation needed
]
and Spain apply it in limited circumstances. In cases such as the US, taxation cannot be avoided by simply transferring assets or moving abroad.
[
17
]
The United States is unlike almost all other countries in that its citizens and permanent residents are subject to
U.S. federal income tax
on their worldwide income even if they reside temporarily or permanently outside the United States. U.S. citizens therefore cannot avoid U.S. taxes simply by emigrating from the U.S. According to
Forbes
magazine some citizens choose to
give up
their
United States citizenship
rather than be subject to the
U.S. tax system
;
[
18
]
but U.S. citizens who reside (or spend long periods of time) outside the U.S. may be able to exclude some salaried income earned overseas (but not other types of income unless specified in a bilateral tax treaty) from income in computing the U.S. federal income tax. The 2015 limit on the amount that can be excluded is US$100,800. In addition, taxpayers can exclude or deduct certain foreign housing amounts. They may also be entitled to exclude from income the value of meals and lodging provided by their employer.
[
19
]
Some American parents do not register their children's birth abroad with American authorities, because they do not want their children to be required to report all earnings to the IRS and pay American taxes for their entire lives, even if they never visit the United States.
[
20
]
Most countries impose taxes on income earned or gains realized within that country regardless of the country of residence of the person or firm. Most countries have entered into bilateral
double taxation
treaties with many other countries to avoid taxing nonresidents twice—once where the income is earned and again in the country of residence (and perhaps, for U.S. citizens, taxed yet again in the country of citizenship)—however, there are relatively few double-taxation treaties with countries regarded as tax havens.
[
21
]
To avoid tax, it is usually not enough to simply move one's assets to a tax haven. One must also personally move to a tax haven (and, for U.S. citizens, renounce one's citizenship) to avoid tax.
Without changing country of residence (or, if a U.S. citizen, without giving up one's citizenship), personal taxation may be legally avoided by the creation of a separate
legal entity
to which one's property is donated. The separate legal entity is often a
company
,
trust
, or
foundation
. These may also be located offshore, such as in the case of many
private foundations
. Assets are transferred to the new company or trust so that gains may be realized, or income earned, within this legal entity rather than earned by the original owner. If assets are later transferred back to an individual, then
capital gains taxes
would apply on all profits. Also
income tax
would still be due on any
salary
or
dividend
drawn from the legal entity.
For a
settlor
(creator of a trust) to avoid tax there may be restrictions on the type, purpose and beneficiaries of the trust. For example, the settlor of the trust may not be allowed to be a
trustee
or even a
beneficiary
and may thus lose control of the assets transferred and/or may be unable to benefit from them.
Tax results depend on definitions of legal terms which are usually vague. For example, vagueness of the distinction between "business expenses" and "personal expenses" is of much concern for taxpayers and tax authorities. More generally, any term of tax law has a vague penumbra, and is a potential source of tax avoidance.
[
22
]
Tax shelters
are investments that allow, and purport to allow, a reduction in one's income tax liability. Although things such as home ownership, pension plans, and Individual Retirement Accounts (IRAs) can be broadly considered "tax shelters", insofar as funds in them are not taxed, provided that they are held within the Individual Retirement Account for the required amount of time, the term "tax shelter" was originally used to describe primarily certain investments made in the form of limited partnerships, some of which were deemed by the U.S. Internal Revenue Service to be abusive.
The Internal Revenue Service and the
United States Department of Justice
have recently teamed up to crack down on abusive tax shelters. In 2003 the Senate's Permanent Subcommittee on Investigations held hearings about tax shelters which are entitled
U.S. tax shelter industry: the role of accountants, lawyers, and financial professionals
. Many of these tax shelters were designed and provided by accountants at the large American accounting firms.
Examples of U.S. tax shelters include: Foreign Leveraged Investment Program (FLIP) and Offshore Portfolio Investment Strategy (OPIS). Both were devised by partners at the accounting firm, KPMG. These tax shelters were also known as "basis shifts" or "defective redemptions."
Prior to 1987, passive investors in certain limited partnerships (such as
oil exploration
or real estate investment ventures) were allowed to use the passive losses (if any) of the partnership (i.e., losses generated by partnership operations in which the investor took no material active part) to offset the investors' income, lowering the amount of income tax that otherwise would be owed by the investor. These partnerships could be structured so that an investor in a high tax bracket could obtain a net economic benefit from partnership-generated passive losses.
In the
Tax Reform Act of 1986
the U.S. Congress introduced the limitation (under
26 U.S.C.
§ 469
) on the deduction of passive losses and the use of passive activity tax credits. The 1986 Act also changed the "at risk" loss rules of
26 U.S.C.
§ 465
. Coupled with the hobby loss rules (
26 U.S.C.
§ 183
), the changes greatly reduced tax avoidance by taxpayers engaged in activities only to generate deductible losses.
Taxpayers normally subject to
estate taxes
or
gift taxes
can reduce their tax liability through the use of trusts. One such strategy, common among
high-net-worth individuals
, is the
grantor retained annuity trust
. Instead of passing assets directly through the estate to the heir, the taxpayer can place assets expected to grow in value in an
irrevocable trust
that ultimately benefits the heir. While the original amount placed in the trust is subject to estate taxes, any
capital gains
are passed to the heir without being subject to taxation.
[
23
]
Share repurchases
allow stockholders instead of paying
dividend tax
to pay lower
capital gains taxes
.
[
24
]
According to a 2022 study, 36% of the profits of multinational firms are shifted to tax havens.
[
25
]
If the profits had been reallocated to their domestic source, "domestic profits would increase by about 20% in high-tax European Union countries, 10% in the United States, and 5% in developing countries, while they would fall by 55% in tax havens."
[
25
]
HMRC
, the UK tax collection agency, estimated that the overall cost of tax avoidance in the UK in 2016-17 was £1.7 billion, of which £0.7 billion was loss of income tax, National Insurance contributions and Capital Gains Tax. The rest came from loss of Corporation Tax, VAT and other direct taxes.
[
26
]
This compares to the wider tax gap (the difference between the amount of tax that should, in theory, be collected by HMRC, against what is actually collected) in that year of £33 billion.
[
26
]
Figures published by the Tax Justice Network show that the UK had one of the lowest rates of tax losses due to profit shifting by multinational companies, with the fourth lowest rate out of 102 countries studied.
[
27
]
According to the figures, the UK lost £1 billion from profit shifting, around 0.04% of its GDP, coming behind Botswana (0.02%), Ecuador (0.02%) and Sweden (0.004%).
[
28
]
Large companies accused of tax avoidance
[
edit
]
In 2008 it was reported by
Private Eye
that
Tesco
utilized offshore holding companies in Luxembourg and partnership agreements to reduce corporation tax liability by up to £50 million a year.
[
29
]
Another scheme previously identified by Private Eye involved depositing £1 billion in a Swiss partnership, and then loaning out that money to overseas Tesco stores, so that profit can be transferred indirectly through interest payments. This scheme is reported to remain in operation and is estimated to be costing the UK exchequer up to £20 million a year in corporation tax.
[
29
]
[
30
]
In 2011,
ActionAid
reported that 25% of the
FTSE 100
companies avoided taxation by locating their subsidiaries in tax havens. This increased to 98% when using the stricter US Congress definition of tax haven and
bank secrecy
jurisdictions.
[
31
]
In 2016, it was reported in the
Private Eye
current affairs magazine that four out of the FTSE top 10 companies paid no corporation tax at all.
[
32
]
Tax avoidance by corporations came to national attention in 2012, when MPs singled out
Google
,
Amazon.com
and
Starbucks
for criticism.
[
33
]
Following accusations that the three companies were diverting hundreds of millions of pounds in UK profits to secretive tax havens, there was widespread outrage across the UK, followed by boycotts of products by Google, Amazon.com and Starbucks.
[
34
]
[
35
]
Following the boycotts and damage to brand image, Starbucks promised to move its tax base from the Netherlands to London and to pay
HMRC
£20million,
[
36
]
but executives from Amazon.com and Google defended their tax avoidance as being within the law.
Google has remained the subject of criticism
in the UK regarding their use of the '
Double Irish
',
Dutch Sandwich
and
Bermuda Black Hole
tax avoidance schemes.
[
37
]
Similarly, Amazon remains the subject of criticism across the UK and
EU
for its tax avoidance. In October 2017, the EU ordered Amazon to repay €250 million in illegal state aid to Luxembourg following a 'sweetheart deal' between Luxembourg and Amazon.com enabling the American company to artificially reduce its tax bill.
[
38
]
PayPal
,
EBay
,
Microsoft
,
Twitter
and
Facebook
have also been found to be using the
Double Irish
and
Dutch Sandwich
schemes. Up to 1,000 individuals in the same year were also discovered to be using
K2
to avoid tax.
[
39
]
Other UK active corporations mentioned in relation to tax avoidance in 2015, particularly the Double Irish, Dutch Sandwich and Bermuda Black Hole:
Technology:
Apple
,
Microsoft
,
PayPal
,
EBay
,
Intel
,
Yahoo!
,
Facebook
,
Uber
,
Netflix
,
Hewlett-Packard
,
IBM
and
Twitter
[
40
]
Retail:
Boots
(who moved their registered office to a Swiss letterbox),
[
41
]
Kellogg's
,
[
42
]
and
TopShop
[
43
]
Football clubs:
Manchester United
,
Birmingham City
,
Coventry City
and
Cheltenham Town
.
[
44
]
News:
Daily Mail
[
45
]
Other corporations mentioned in relation to tax avoidance in later years have been
Vodafone
,
AstraZeneca
,
SABMiller
,
GlaxoSmithKline
and
British American Tobacco
.
[
32
]
Tax avoidance has not always related to corporation tax. A number of companies including
Tesco
,
Sainsbury's
,
WH Smith
,
Boots
and
Marks and Spencer
used a scheme to avoid
VAT
by forcing customers paying by card to unknowingly pay a 2.5% 'card transaction fee', though the total charged to the customer remained the same. Such schemes came to light after
HMRC
litigated against
Debenhams
over the scheme during 2005.
[
46
]
Small company tax avoidance
[
edit
]
In the UK, small business tax avoidance has a substantial impact.
[
47
]
HMRC’s tax gap analysis of 2025 calculated that small business is responsible for 60% of an annual £47bn tax shortfall in the UK.
[
48
]
General anti-avoidance rule
[
edit
]
Since the late 1990s,
New Labour
consulted on a "general anti-avoidance rule" (GAAR) for taxation, before deciding against the idea. By 2003, public interest in a GAAR surged as evidence of the scale of tax avoidance used by individuals in the
financial
and other sectors became apparent, though in its 2004 Budget the Labour Government announced a new "disclosure regime" as an alternative, whereby tax avoidance schemes would be required to be disclosed to the revenue departments.
[
49
]
In December 2010, the new Coalition government commissioned a report which would consider whether there should be a general anti-avoidance rule for the UK, which recommended that the UK should introduce such a rule, which was introduced in 2013. The rule prevents the reduction of tax by legal arrangements, where those arrangements are put in place purely to reduce tax, and would not otherwise be regarded as a reasonable course of action.
[
7
]
Following the
Panama Papers
leak in 2016,
Private Eye
,
The Guardian
and other British media outlets noted that
Edward Troup
, who became executive chair of
HM Revenue and Customs
, had worked with
Simmons & Simmons
in 2004 representing corporate tax havens and opposed the GAAR in 1998.
[
50
]
[
51
]
[
52
]
Public sector appointments
[
edit
]
In January 2012 a review of the tax arrangements of people engaged on public sector appointments was undertaken, in order to "ascertain the extent
of arrangements which could allow public sector appointees to minimise their tax payments" and make recommendations accordingly.
[
53
]
The review was published on 23 May 2012, advising that:
the most senior staff in public sector appointments should be on the payroll, unless there are exceptional temporary circumstances;
through their contracting, departments must be able to seek formal assurance from contractors with off payroll arrangements lasting more than six months and costing over £220 per day that income tax and national insurance obligations were being met. Departments were advised to terminate a contract if that assurance was not provided;
implementation would be monitored carefully with financial sanctions for departments which did not comply.
[
53
]
Historical tax avoidance
[
edit
]
Avoiding the
window tax
in England
One historic example of tax avoidance still evident today was the payment of
window tax
. It was introduced in
England and Wales
in 1696 with the aim of imposing tax on the relative prosperity of individuals without the controversy of introducing an
income tax
.
[
54
]
The bigger the house, the more windows it was likely to have, and the more tax the occupants would pay. Nevertheless, the tax was unpopular, because it was seen by some as a "tax on light" (allegedly leading to the phrase daylight robbery) and led property owners to block up windows to avoid it.
[
55
]
The tax was repealed in 1851.
[
56
]
Deliberate roof destruction
[
edit
]
Other historic examples of tax avoidance were the
deliberate destructions
of roofs in Scotland to avoid substantial
property taxes
. The roof of
Slains Castle
was removed in 1925, and the building has deteriorated since.
[
57
]
The owners of
Fetteresso Castle
(now restored) deliberately destroyed their roof after
World War II
in protest at the new taxes.
The term tax avoidance indicates a situation in which a taxpayer legally minimizes the amount of his income tax owed. This circumstance occurs by declaring as many deductions and credits as permitted or prioritizing investments with tax advantages.
[
58
]
An IRS report indicates that, in 2009, 1,470 individuals earning more than $1,000,000 annually faced a net tax liability of zero or less.
[
59
]
Also, in 1998 alone, a total of 94 corporations faced a net liability of less than half the full 35% corporate tax rate and the corporations
Lyondell Chemical
,
Texaco
,
Chevron
,
CSX
,
Tosco
,
PepsiCo
,
Owens & Minor
,
Pfizer
,
JP Morgan
,
Saks
,
Goodyear
,
Ryder
,
Enron
,
Colgate-Palmolive
,
Worldcom
,
Eaton
,
Weyerhaeuser
,
General Motors
,
El Paso Energy
, Westpoint Stevens,
MedPartners
,
Phillips Petroleum
,
McKesson
and
Northrop Grumman
all had net negative tax liabilities.
[
60
]
Additionally, this phenomenon was widely documented regarding
General Electric
in early 2011.
[
61
]
Furthermore, a
Government Accountability Office
study found that, from 1998 to 2005, 55 percent of United States companies paid no federal income taxes during at least one year in a seven-year period it studied.
[
62
]
[
63
]
A review in 2011 by
Citizens for Tax Justice
and the
Institute on Taxation and Economic Policy
of companies in the Fortune 500 profitable every year from 2008 through 2010 stated these companies paid an average tax rate of 18.5% and that 30 of these companies actually had a
negative income tax
due.
[
64
]
In 2012,
Hewlett-Packard
lost a lawsuit with the IRS over a "foreign tax credit generator" which was engineered by a division of
AIG
.
[
65
]
Al Jazeera
also wrote in 2012 that "Rich individuals and their families have as much as $32 trillion of hidden financial assets in offshore tax havens, representing up to $280bn in lost income tax revenues ... John Christensen of the
Tax Justice Network
told Al Jazeera that he was shocked by 'the sheer scale of the figures'. ... 'We're talking about very big, well-known brands –
HSBC
,
Citigroup
,
Bank of America
,
UBS
,
Credit Suisse
... and they do it knowing fully well that their clients, more often than not, are evading and avoiding taxes.' Much of this activity, Christensen added, was illegal."
[
66
]
As a result of the tax sheltering, the government responded with Treasury Department
Circular 230
. In 2010, the
Health Care and Education Reconciliation Act of 2010
codified the "economic substance" rule of
Gregory v. Helvering
(1935).
[
67
]
The US
Public Interest Research Group
said in 2014 that the
United States
government loses roughly $184 billion per year due to corporations such as Pfizer, Microsoft and Citigroup using offshore tax havens to avoid paying US taxes. According to PIRG:
Pfizer
paid no US income taxes 2010–2012, despite earning $43 billion. The corporation received more than $2 billion in federal tax refunds. In 2013, Pfizer operated 128 subsidiaries in tax havens and had $69 billion offshore which could not be collected by the
Internal Revenue Service
(IRS);
Microsoft
maintains five tax haven subsidiaries and held $76.4 billion overseas in 2013, thus saving the corporation $24.4 billion in taxes;
Citigroup
maintained 21 subsidiaries in tax haven countries in 2013, and kept $43.8 billion in offshore jurisdictions, thus saving the corporation an additional $11.7 billion in taxes.
[
68
]
According to an analysis by the
Institute on Taxation and Economic Policy
, global companies in the US are paying an effective tax rate of about negative 9 percent per annum.
[
69
]
An investigation by
ProPublica
published in 2021 based on leaked IRS documents revealed techniques by which billionaires accumulated massive wealth while paying lower rates than middle-income people, or no tax, or in some cases getting paid refundable childcare tax credits.
[
70
]
These include:
Instead of a salary taxed at the 37% top rate, accepting stock, which is taxed at the 20%
capital gains
rate.
Avoid paying tax on capital gains with the "
buy, borrow, die
" technique
[
71
]
:
Buy or earn capital assets like stocks and real estate, and then never sell because assets do not count as income until sold.
Using capital assets as
collateral
to borrow spending money at interest rates considerably lower than the tax rate; loans are not taxed as income.
Holding capital assets until after death, when a "
step-up in basis
" zeroes out the accumulated gains and allows heirs to not pay any capital gains tax.
Avoid the
estate tax
by moving money into
trusts
or charitable foundations before death
Offset
dividend
income with the interest paid on loans, or relying on increasing stock prices instead of a dividend
Offset income with "paper" losses in business operations
Offset income with
charitable contributions
Tax avoidance may be considered to be the dodging of one's duties to society, or alternatively the right of every citizen to structure one's affairs in a manner allowed by law, to pay no more tax than what is required. Attitudes vary from approval through neutrality to outright hostility. Attitudes may vary depending on the steps taken in the avoidance scheme, or the perceived unfairness of the tax being avoided.
[
72
]
In 2008, the charity
Christian Aid
published a report,
Death and taxes: the true toll of tax dodging
, which criticised tax exiles and tax avoidance by some of the world's largest companies, linking
tax evasion
to the deaths of millions of children in developing countries.
[
73
]
However the research behind these calculations has been questioned in a 2009 paper prepared for the UK
Department for International Development
.
[
74
]
According to the
Financial Times
there is a growing trend for charities to prioritise tax avoidance as a key campaigning issue, with policy makers across the world considering changes to make tax avoidance more difficult.
[
75
]
In 2010, tax avoidance became a hot-button issue in the UK. An organisation,
UK Uncut
, began to encourage people to protest at local high-street shops that were thought to be avoiding tax, such as
Vodafone
,
Topshop
and the
Arcadia Group
.
[
76
]
In 2012, during the
Occupy movement
in the United States, tax avoidance for the 99% was proposed as a protest tool.
[
77
]
Prem Sikka
, Professor of Accounting at the Essex Business School (University of Essex) and scientific advisor of the
Tax Justice Network
pointed to a discrepancy between the
Corporate Social Responsibility
claims of multinational companies and “their internal dynamics aimed at maximising their profits through things like tax avoidance”. He wrote in an article commenting the Lux Leaks publications: “Big corporations and accountancy firms are engaged in organised hypocrisy.”
[
78
]
Public polling undertaken in the UK in 2025 has found continued high levels of concern around corporate tax avoidance and agreement for regulations to be tightened.
[
79
]
Surveys conducted in 2025 in each of the EU's 27 Member States have found high levels of support for large multinationals contributing toward a global minimum tax in each country in which they operate.
[
80
]
As a response to public opinion regarding tax avoidance, the
Fair Tax Mark
was established in the UK during 2014 as an independent certification scheme to identify and recognise companies which pay taxes "in accordance with the spirit of all tax laws" and not to use options, allowances, or reliefs, or undertake specific transactions, "that are contrary to the spirit of the law".
[
81
]
[
82
]
The Mark is operated by a not-for-profit community benefit society, the
Fair Tax Foundation
.
Awardees of this mark in the UK include
The Co-op
,
[
83
]
SSE
,
Watches of Switzerland
,
Ecology Building Society
,
Lush Cosmetics
,
Richer Sounds
,
Scottish Water
,
United Utilities
,
Marshalls
, several large regional co-operatives (
East of England
,
Midcounties
,
Scotmid
) and
The Phone Co-op
. Outside of the UK, awardees include
Iberdrola
,
[
84
]
Orsted
[
85
]
and
Vattenfall
.
[
86
]
Government and judicial response
[
edit
]
Countries with politicians, public officials or close associates implicated in the
Panama Papers
leak on 15 April 2016
Tax avoidance reduces government revenue, so governments with a stricter anti-avoidance stance seek to prevent tax avoidance or keep it within limits. The obvious way to do this is to frame tax rules so that there is a smaller scope for avoidance. In practice this has not always been achievable and has led to an ongoing battle between governments amending legislation and
tax advisors
finding new scope/loopholes for tax avoidance in the amended rules.
[
citation needed
]
To allow prompter response to tax avoidance schemes, the US Tax Disclosure Regulations (2003) require prompter and fuller disclosure than previously required, a tactic which was applied in the UK in 2004.
Some countries such as Canada, Australia, United Kingdom and New Zealand have introduced a statutory
General Anti-Avoidance Rule
(or
General Anti-Abuse Rule
,
GAAR
). Canada also uses
Foreign Accrual Property Income
rules to obviate certain types of tax avoidance. In the United Kingdom many provisions of the tax legislation (known as "anti-avoidance" provisions) apply to prevent tax avoidance where the main object (or purpose), or one of the main objects (or purposes), of a transaction is to enable tax advantages to be obtained.
In the United States, the
Internal Revenue Service
distinguishes some schemes as "abusive" and therefore illegal. The
Alternative Minimum Tax
was developed to reduce the impact of certain tax avoidance schemes. Furthermore, while tax avoidance is in principle legal, if the IRS in its sole judgment determines that tax avoidance is the 'principal purpose' for an expatriation attempt, 'covered expat' status will be applied to the requester, thereby forcing an expatriation tax on worldwide assets to be paid as a condition of expatriation.
[
87
]
The IRS presumes a principal purpose of tax avoidance if a taxpayer requesting expatriation has a net worth of $622,000 or more, or has had more than $124,000 in average annual net income tax over the 5 tax years ending before the date of expatriation.
In the UK, judicial doctrines to prevent tax avoidance began in
IRC v Ramsay
(1981) which decided that where a transaction has pre-arranged artificial steps that serve no commercial purpose other than to save tax, the proper approach is to tax the effect of the transaction as a whole. This is known as the Ramsay principle and this case was followed by
Furniss v. Dawson
(1984) which extended the Ramsay principle. This approach has been rejected in most Commonwealth jurisdictions even in those where UK cases are generally regarded as persuasive. After two decades, there have been numerous decisions, with inconsistent approaches, and both the Revenue authorities and professional advisors remain quite unable to predict outcomes. For this reason this approach can be seen as a failure or at best only partly successful.
In the judiciary, different judges have taken different attitudes. As a generalisation, for example, judges in the United Kingdom before the 1970s regarded tax avoidance with neutrality; but nowadays they may regard aggressive tax avoidance with increasing hostility.
In the UK in 2004, the Labour government announced that it would use retrospective legislation to counteract some tax avoidance schemes, and it has subsequently done so on a few occasions, notably
BN66
. Initiatives announced in 2010 suggest an increasing willingness on the part of HMRC to use retrospective action to counter avoidance schemes, even when no warning has been given.
[
88
]
The UK Government has pushed the initiative led by the
Organisation for Economic Co-operation and Development
(OECD) on base erosion and profit shifting.
[
89
]
In the 2015 Autumn Statement, Chancellor
George Osborne
announced that £800m would be spent on tackling tax avoidance in order to recover £5 billion a year by 2019–20. In addition, large companies will now have to publish their UK tax strategies and any large businesses that persistently engage in aggressive tax planning will be subject to special measures.
[
90
]
With these policies, Osborne has claimed to be at the forefront of combating tax avoidance.
[
91
]
However, he has been criticised over his perceived inaction on enacting policies set forth by the OECD to combat tax avoidance.
[
32
]
In April 2015, the Chancellor George Osborne announced a tax on diverted profits, quickly nicknamed the "Google Tax" by the press, designed to discourage large companies moving profits out of the UK to avoid tax.
[
92
]
In 2016, Google agreed to pay back £130m of tax dating back to 2005 to HMRC, which said it was the "full tax due in law".
[
93
]
However, this amount of tax has been criticised by
Labour
, with ex Labour leader
Jeremy Corbyn
saying that the rate of tax paid by Google only amounted to 3%.
[
93
]
Former
Liberal Democrat
Business Secretary
Vince Cable
also said Google had "got off very, very lightly", and Osborne "made a fool of himself" by hailing the deal as a victory.
[
93
]
Although claiming that it was "absurd" to lay blame onto Google for tax avoidance, saying that
EU member states
should "[compete] with each other to offer firms the lowest corporate tax rates", Conservative MP
Boris Johnson
said it was a "good thing" for corporations to pay more tax.
[
94
]
However, Johnson said he did not want tax rates to go up or for European Union countries to do this in unison.
[
94
]
Estate planning
Fair Tax Town
movement
Gregory v. Helvering
Criticism of Apple Inc.#Taxes
Criticism of Google#Tax avoidance
Corruption in Finland#Tax avoidance
General:
Base erosion and profit shifting
Capital flight
Carried interest
Conduit and Sink OFCs
Gaming the system
Irish Section 110 SPVs
List of foundations established in Vaduz
Tax exemption
Tax noncompliance
Luxembourg Leaks
Singapore Sling (tax avoidance)
Swiss Leaks
Panama Papers
Paradise Papers
Emmanuel Saez
and
Gabriel Zucman
. 2019.
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Toggle Anti-avoidance measures subsection
- [1\.1 Legislative measures](https://en.wikipedia.org/wiki/Tax_avoidance#Legislative_measures)
- [1\.2 Judicial anti-avoidance measures](https://en.wikipedia.org/wiki/Tax_avoidance#Judicial_anti-avoidance_measures)
- [1\.3 EU Anti-Tax Avoidance Package](https://en.wikipedia.org/wiki/Tax_avoidance#EU_Anti-Tax_Avoidance_Package)
- [1\.4 Anti-avoidance measures by country](https://en.wikipedia.org/wiki/Tax_avoidance#Anti-avoidance_measures_by_country)
- [1\.4.1 Australia](https://en.wikipedia.org/wiki/Tax_avoidance#Australia)
- [1\.4.2 United States](https://en.wikipedia.org/wiki/Tax_avoidance#United_States)
- [2 Methods](https://en.wikipedia.org/wiki/Tax_avoidance#Methods)
Toggle Methods subsection
- [2\.1 Country of residence](https://en.wikipedia.org/wiki/Tax_avoidance#Country_of_residence)
- [2\.2 Double taxation](https://en.wikipedia.org/wiki/Tax_avoidance#Double_taxation)
- [2\.3 Legal entities](https://en.wikipedia.org/wiki/Tax_avoidance#Legal_entities)
- [2\.4 Legal vagueness](https://en.wikipedia.org/wiki/Tax_avoidance#Legal_vagueness)
- [2\.5 Tax shelters](https://en.wikipedia.org/wiki/Tax_avoidance#Tax_shelters)
- [2\.6 Trusts](https://en.wikipedia.org/wiki/Tax_avoidance#Trusts)
- [2\.7 Other](https://en.wikipedia.org/wiki/Tax_avoidance#Other)
- [3 Tax avoiders](https://en.wikipedia.org/wiki/Tax_avoidance#Tax_avoiders)
Toggle Tax avoiders subsection
- [3\.1 United Kingdom](https://en.wikipedia.org/wiki/Tax_avoidance#United_Kingdom)
- [3\.1.1 Large companies accused of tax avoidance](https://en.wikipedia.org/wiki/Tax_avoidance#Large_companies_accused_of_tax_avoidance)
- [3\.1.2 Small company tax avoidance](https://en.wikipedia.org/wiki/Tax_avoidance#Small_company_tax_avoidance)
- [3\.1.3 General anti-avoidance rule](https://en.wikipedia.org/wiki/Tax_avoidance#General_anti-avoidance_rule)
- [3\.1.4 Public sector appointments](https://en.wikipedia.org/wiki/Tax_avoidance#Public_sector_appointments)
- [3\.1.5 Historical tax avoidance](https://en.wikipedia.org/wiki/Tax_avoidance#Historical_tax_avoidance)
- [3\.1.5.1 Window tax](https://en.wikipedia.org/wiki/Tax_avoidance#Window_tax)
- [3\.1.5.2 Deliberate roof destruction](https://en.wikipedia.org/wiki/Tax_avoidance#Deliberate_roof_destruction)
- [3\.2 United States](https://en.wikipedia.org/wiki/Tax_avoidance#United_States_2)
- [4 Public opinion](https://en.wikipedia.org/wiki/Tax_avoidance#Public_opinion)
Toggle Public opinion subsection
- [4\.1 Fair Tax Mark](https://en.wikipedia.org/wiki/Tax_avoidance#Fair_Tax_Mark)
- [5 Government and judicial response](https://en.wikipedia.org/wiki/Tax_avoidance#Government_and_judicial_response)
Toggle Government and judicial response subsection
- [5\.1 United Kingdom](https://en.wikipedia.org/wiki/Tax_avoidance#United_Kingdom_2)
- [6 See also](https://en.wikipedia.org/wiki/Tax_avoidance#See_also)
- [7 Further reading](https://en.wikipedia.org/wiki/Tax_avoidance#Further_reading)
- [8 References](https://en.wikipedia.org/wiki/Tax_avoidance#References)
- [9 External links](https://en.wikipedia.org/wiki/Tax_avoidance#External_links)
Toggle the table of contents
# Tax avoidance
30 languages
- [العربية](https://ar.wikipedia.org/wiki/%D8%AA%D8%AC%D9%86%D8%A8_%D8%B6%D8%B1%D9%8A%D8%A8%D9%8A "تجنب ضريبي – Arabic")
- [Azərbaycanca](https://az.wikipedia.org/wiki/Vergid%C9%99n_yay%C4%B1nma "Vergidən yayınma – Azerbaijani")
- [Català](https://ca.wikipedia.org/wiki/Elusi%C3%B3_fiscal "Elusió fiscal – Catalan")
- [Čeština](https://cs.wikipedia.org/wiki/Obch%C3%A1zen%C3%AD_dan%C4%9B "Obcházení daně – Czech")
- [Cymraeg](https://cy.wikipedia.org/wiki/Arbed_talu_treth "Arbed talu treth – Welsh")
- [Deutsch](https://de.wikipedia.org/wiki/Steuervermeidung "Steuervermeidung – German")
- [Ελληνικά](https://el.wikipedia.org/wiki/%CE%A6%CE%BF%CF%81%CE%BF%CE%B1%CF%80%CE%BF%CF%86%CF%85%CE%B3%CE%AE "Φοροαποφυγή – Greek")
- [Español](https://es.wikipedia.org/wiki/Elusi%C3%B3n_fiscal "Elusión fiscal – Spanish")
- [فارسی](https://fa.wikipedia.org/wiki/%D8%A7%D8%AC%D8%AA%D9%86%D8%A7%D8%A8_%D8%A7%D8%B2_%D9%85%D8%A7%D9%84%DB%8C%D8%A7%D8%AA "اجتناب از مالیات – Persian")
- [Suomi](https://fi.wikipedia.org/wiki/Veronkierto "Veronkierto – Finnish")
- [Français](https://fr.wikipedia.org/wiki/Optimisation_fiscale "Optimisation fiscale – French")
- [עברית](https://he.wikipedia.org/wiki/%D7%AA%D7%9B%D7%A0%D7%95%D7%9F_%D7%9E%D7%A1 "תכנון מס – Hebrew")
- [हिन्दी](https://hi.wikipedia.org/wiki/%E0%A4%95%E0%A4%B0_%E0%A4%AC%E0%A4%9A%E0%A4%BE%E0%A4%B5 "कर बचाव – Hindi")
- [Bahasa Indonesia](https://id.wikipedia.org/wiki/Penghindaran_pajak "Penghindaran pajak – Indonesian")
- [Italiano](https://it.wikipedia.org/wiki/Elusione_fiscale "Elusione fiscale – Italian")
- [日本語](https://ja.wikipedia.org/wiki/%E7%A7%9F%E7%A8%8E%E5%9B%9E%E9%81%BF "租税回避 – Japanese")
- [한국어](https://ko.wikipedia.org/wiki/%EC%A1%B0%EC%84%B8_%ED%9A%8C%ED%94%BC "조세 회피 – Korean")
- [Lietuvių](https://lt.wikipedia.org/wiki/Mokes%C4%8Di%C5%B3_optimizavimas "Mokesčių optimizavimas – Lithuanian")
- [Nederlands](https://nl.wikipedia.org/wiki/Belastingontwijking "Belastingontwijking – Dutch")
- [Norsk bokmål](https://no.wikipedia.org/wiki/Skatteomg%C3%A5else "Skatteomgåelse – Norwegian Bokmål")
- [Polski](https://pl.wikipedia.org/wiki/Optymalizacja_podatkowa "Optymalizacja podatkowa – Polish")
- [Română](https://ro.wikipedia.org/wiki/Optimizare_fiscal%C4%83 "Optimizare fiscală – Romanian")
- [Русский](https://ru.wikipedia.org/wiki/%D0%9D%D0%B0%D0%BB%D0%BE%D0%B3%D0%BE%D0%B2%D0%B0%D1%8F_%D0%BE%D0%BF%D1%82%D0%B8%D0%BC%D0%B8%D0%B7%D0%B0%D1%86%D0%B8%D1%8F "Налоговая оптимизация – Russian")
- [Simple English](https://simple.wikipedia.org/wiki/Tax_avoidance "Tax avoidance – Simple English")
- [Svenska](https://sv.wikipedia.org/wiki/Skatteplanering "Skatteplanering – Swedish")
- [ไทย](https://th.wikipedia.org/wiki/%E0%B8%81%E0%B8%B2%E0%B8%A3%E0%B9%80%E0%B8%A5%E0%B8%B5%E0%B9%88%E0%B8%A2%E0%B8%87%E0%B8%A0%E0%B8%B2%E0%B8%A9%E0%B8%B5 "การเลี่ยงภาษี – Thai")
- [Türkçe](https://tr.wikipedia.org/wiki/Vergiden_ka%C3%A7%C4%B1nma "Vergiden kaçınma – Turkish")
- [Українська](https://uk.wikipedia.org/wiki/%D0%9F%D0%BE%D0%B4%D0%B0%D1%82%D0%BA%D0%BE%D0%B2%D0%B0_%D0%BE%D0%BF%D1%82%D0%B8%D0%BC%D1%96%D0%B7%D0%B0%D1%86%D1%96%D1%8F "Податкова оптимізація – Ukrainian")
- [粵語](https://zh-yue.wikipedia.org/wiki/%E9%81%BF%E7%A8%85 "避稅 – Cantonese")
- [中文](https://zh.wikipedia.org/wiki/%E7%AF%80%E7%A8%85 "節稅 – Chinese")
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From Wikipedia, the free encyclopedia
Financial optimization technique
This article is about the legal reduction of taxes. For the illegal equivalent, see [Tax evasion](https://en.wikipedia.org/wiki/Tax_evasion "Tax evasion"). For the refusal to pay tax, see [Tax resistance](https://en.wikipedia.org/wiki/Tax_resistance "Tax resistance").
| |
|---|
| Part of a series on |
| [Taxation](https://en.wikipedia.org/wiki/Tax "Tax") |
| [](https://en.wikipedia.org/wiki/File:10_Percent_Legacy_and_Succession_Duty_Impressed_Duty_Stamp.svg) |
| An aspect of [fiscal policy](https://en.wikipedia.org/wiki/Fiscal_policy "Fiscal policy") |
| [Policies](https://en.wikipedia.org/wiki/Tax_policy "Tax policy") [Economic justice](https://en.wikipedia.org/wiki/Economic_justice "Economic justice") [Government revenue](https://en.wikipedia.org/wiki/Government_revenue "Government revenue") [Property tax equalization](https://en.wikipedia.org/wiki/Property_tax_equalization "Property tax equalization") [Tax revenue](https://en.wikipedia.org/wiki/Tax_revenue "Tax revenue") [Non-tax revenue](https://en.wikipedia.org/wiki/Non-tax_revenue "Non-tax revenue") [Tax law](https://en.wikipedia.org/wiki/Tax_law "Tax law") [Tax bracket](https://en.wikipedia.org/wiki/Tax_bracket "Tax bracket") [Flat tax](https://en.wikipedia.org/wiki/Flat_tax "Flat tax") [Tax burden](https://en.wikipedia.org/wiki/Tax_burden "Tax burden") [Tax threshold](https://en.wikipedia.org/wiki/Income_tax_threshold "Income tax threshold") [Taxation as theft](https://en.wikipedia.org/wiki/Taxation_as_theft "Taxation as theft") [Tax shift](https://en.wikipedia.org/wiki/Tax_shift "Tax shift") [Tax cut](https://en.wikipedia.org/wiki/Tax_cut "Tax cut") [Tax advantage](https://en.wikipedia.org/wiki/Tax_advantage "Tax advantage") [Tax incentive](https://en.wikipedia.org/wiki/Tax_incentive "Tax incentive") [Tax reform](https://en.wikipedia.org/wiki/Tax_reform "Tax reform") [Double taxation](https://en.wikipedia.org/wiki/Double_taxation "Double taxation") [Tax harmonization](https://en.wikipedia.org/wiki/Tax_harmonization "Tax harmonization") [Tax competition](https://en.wikipedia.org/wiki/Tax_competition "Tax competition") [Voluntary taxation](https://en.wikipedia.org/wiki/Voluntary_taxation "Voluntary taxation") [Representation](https://en.wikipedia.org/wiki/No_taxation_without_representation "No taxation without representation") |
| General theory |
| [Excess burden](https://en.wikipedia.org/wiki/Excess_burden_of_taxation "Excess burden of taxation") [Tax efficiency](https://en.wikipedia.org/wiki/Tax_efficiency "Tax efficiency") [Tax incidence](https://en.wikipedia.org/wiki/Tax_incidence "Tax incidence") [Laffer curve](https://en.wikipedia.org/wiki/Laffer_curve "Laffer curve") [Optimal tax](https://en.wikipedia.org/wiki/Optimal_tax "Optimal tax") [Price effect](https://en.wikipedia.org/wiki/Effect_of_taxes_and_subsidies_on_price "Effect of taxes and subsidies on price") [Theories](https://en.wikipedia.org/wiki/Theories_of_taxation "Theories of taxation") [Optimal capital income taxation](https://en.wikipedia.org/wiki/Optimal_capital_income_taxation "Optimal capital income taxation") |
| Distribution of tax |
| [Tax rate](https://en.wikipedia.org/wiki/Tax_rate "Tax rate") [Burden](https://en.wikipedia.org/wiki/Tax_burden "Tax burden") [Flat](https://en.wikipedia.org/wiki/Flat_tax "Flat tax") [Progressive](https://en.wikipedia.org/wiki/Progressive_tax "Progressive tax") [Regressive](https://en.wikipedia.org/wiki/Regressive_tax "Regressive tax") [Proportional](https://en.wikipedia.org/wiki/Proportional_tax "Proportional tax") |
| [Collection](https://en.wikipedia.org/wiki/Tax_collection "Tax collection") [Economic nexus in the United States](https://en.wikipedia.org/wiki/Economic_nexus_in_the_United_States "Economic nexus in the United States") [Revenue service](https://en.wikipedia.org/wiki/Revenue_service "Revenue service") [Revenue stamp](https://en.wikipedia.org/wiki/Revenue_stamp "Revenue stamp") [Tax assessment](https://en.wikipedia.org/wiki/Tax_assessment "Tax assessment") [Taxable income](https://en.wikipedia.org/wiki/Taxable_income "Taxable income") [Tax lien](https://en.wikipedia.org/wiki/Tax_lien "Tax lien") [Tax refund](https://en.wikipedia.org/wiki/Tax_refund "Tax refund") [Tax shield](https://en.wikipedia.org/wiki/Tax_shield "Tax shield") [Tax residence](https://en.wikipedia.org/wiki/Tax_residence "Tax residence") [Tax preparation](https://en.wikipedia.org/wiki/Tax_preparation "Tax preparation") [Tax protester](https://en.wikipedia.org/wiki/Tax_protester "Tax protester") [Tax investigation](https://en.wikipedia.org/wiki/Tax_investigation "Tax investigation") [Tax collector](https://en.wikipedia.org/wiki/Tax_collector "Tax collector") [Tax withholding](https://en.wikipedia.org/wiki/Tax_withholding "Tax withholding") [Private tax collection](https://en.wikipedia.org/wiki/Privatized_tax_collection "Privatized tax collection") |
| Legal [tax avoidance]() |
| [Base erosion and profit shifting](https://en.wikipedia.org/wiki/Base_erosion_and_profit_shifting "Base erosion and profit shifting") (BEPS) [Double Irish](https://en.wikipedia.org/wiki/Double_Irish_arrangement "Double Irish arrangement") [Single Malt](https://en.wikipedia.org/wiki/Double_Irish_arrangement#Replacement_by_single_malt "Double Irish arrangement") [CAIA](https://en.wikipedia.org/wiki/Double_Irish_arrangement#Backstop_of_capital_allowances "Double Irish arrangement") [Dutch Sandwich](https://en.wikipedia.org/wiki/Dutch_Sandwich "Dutch Sandwich") [Estate planning](https://en.wikipedia.org/wiki/Estate_planning "Estate planning") [Fuel dye](https://en.wikipedia.org/wiki/Fuel_dye "Fuel dye") [Repatriation tax avoidance](https://en.wikipedia.org/wiki/Repatriation_tax_avoidance "Repatriation tax avoidance") [Share repurchase](https://en.wikipedia.org/wiki/Share_repurchase "Share repurchase") [Tariff engineering](https://en.wikipedia.org/wiki/Tariff_engineering "Tariff engineering") [Tax credit](https://en.wikipedia.org/wiki/Tax_credit "Tax credit") [Tax deduction](https://en.wikipedia.org/wiki/Tax_deduction "Tax deduction") [Tax exemption](https://en.wikipedia.org/wiki/Tax_exemption "Tax exemption") [Taxpayer groups](https://en.wikipedia.org/wiki/Taxpayer_groups "Taxpayer groups") [Tax holiday](https://en.wikipedia.org/wiki/Tax_holiday "Tax holiday") [Tax inversion](https://en.wikipedia.org/wiki/Tax_inversion "Tax inversion") [Tax farming](https://en.wikipedia.org/wiki/Farm_\(revenue_leasing\) "Farm (revenue leasing)") [Tax patent](https://en.wikipedia.org/wiki/Tax_patent "Tax patent") [Tax shelter](https://en.wikipedia.org/wiki/Tax_shelter "Tax shelter") |
| Illegal [tax evasion](https://en.wikipedia.org/wiki/Tax_evasion "Tax evasion") |
| [Tax amnesty](https://en.wikipedia.org/wiki/Tax_amnesty "Tax amnesty") [Black market](https://en.wikipedia.org/wiki/Black_market "Black market") [Debtors' prison](https://en.wikipedia.org/wiki/Debtors%27_prison "Debtors' prison") [Tax exile](https://en.wikipedia.org/wiki/Tax_exile "Tax exile") [Smuggling](https://en.wikipedia.org/wiki/Smuggling "Smuggling") [Tax resistance](https://en.wikipedia.org/wiki/Tax_resistance "Tax resistance") [Transfer mispricing](https://en.wikipedia.org/wiki/Transfer_mispricing "Transfer mispricing") [Unreported employment](https://en.wikipedia.org/wiki/Unreported_employment "Unreported employment") |
| Locations |
| [Tax havens](https://en.wikipedia.org/wiki/Tax_haven "Tax haven") [Corporate havens](https://en.wikipedia.org/wiki/Corporate_haven "Corporate haven") [Offshore financial centres](https://en.wikipedia.org/wiki/Offshore_financial_centre "Offshore financial centre") (OFCs) [Offshore magic circle](https://en.wikipedia.org/wiki/Offshore_magic_circle "Offshore magic circle") [Conduit and sink OFCs](https://en.wikipedia.org/wiki/Conduit_and_sink_OFCs "Conduit and sink OFCs") [Financial centres](https://en.wikipedia.org/wiki/Financial_centre "Financial centre") [Financial Secrecy Index](https://en.wikipedia.org/wiki/Financial_Secrecy_Index "Financial Secrecy Index") |
| Major examples |
| [Ireland as a tax haven](https://en.wikipedia.org/wiki/Ireland_as_a_tax_haven "Ireland as a tax haven") *[Ireland v. Commission](https://en.wikipedia.org/wiki/Apple%27s_EU_tax_dispute "Apple's EU tax dispute")* [Leprechaun economics](https://en.wikipedia.org/wiki/Leprechaun_economics "Leprechaun economics") [Liechtenstein tax affair](https://en.wikipedia.org/wiki/2008_Liechtenstein_tax_affair "2008 Liechtenstein tax affair") [Luxembourg Leaks](https://en.wikipedia.org/wiki/LuxLeaks "LuxLeaks") [Offshore Leaks](https://en.wikipedia.org/wiki/Offshore_Leaks "Offshore Leaks") [Paradise Papers](https://en.wikipedia.org/wiki/Paradise_Papers "Paradise Papers") [Panama Papers](https://en.wikipedia.org/wiki/Panama_Papers "Panama Papers") [Swiss Leaks](https://en.wikipedia.org/wiki/Swiss_Leaks "Swiss Leaks") [United States as a tax haven](https://en.wikipedia.org/wiki/United_States_as_a_tax_haven "United States as a tax haven") [Panama as a tax haven](https://en.wikipedia.org/wiki/Panama_as_a_tax_haven "Panama as a tax haven") |
| [Types](https://en.wikipedia.org/wiki/List_of_taxes "List of taxes") [Direct](https://en.wikipedia.org/wiki/Direct_tax "Direct tax") [Indirect](https://en.wikipedia.org/wiki/Indirect_tax "Indirect tax") [Per unit](https://en.wikipedia.org/wiki/Per_unit_tax "Per unit tax") [Ad valorem](https://en.wikipedia.org/wiki/Ad_valorem_tax "Ad valorem tax") [Aviation](https://en.wikipedia.org/wiki/Aviation_taxation_and_subsidies "Aviation taxation and subsidies") [Airport improvement](https://en.wikipedia.org/wiki/Airport_improvement_fee "Airport improvement fee") [Landing](https://en.wikipedia.org/wiki/Landing_fee "Landing fee") [Solidarity](https://en.wikipedia.org/wiki/Solidarity_tax_on_airplane_tickets "Solidarity tax on airplane tickets") [Capital gains](https://en.wikipedia.org/wiki/Capital_gains_tax "Capital gains tax") [Expatriation](https://en.wikipedia.org/wiki/Expatriation_tax "Expatriation tax") [Consumption](https://en.wikipedia.org/wiki/Consumption_tax "Consumption tax") [Departure](https://en.wikipedia.org/wiki/Departure_tax "Departure tax") [Hotel](https://en.wikipedia.org/wiki/Hotel_tax "Hotel tax") [Sales](https://en.wikipedia.org/wiki/Sales_tax "Sales tax") [Stamp](https://en.wikipedia.org/wiki/Stamp_duty "Stamp duty") [Television](https://en.wikipedia.org/wiki/Television_licence "Television licence") [Tourist](https://en.wikipedia.org/wiki/Tourist_tax "Tourist tax") [Value-added](https://en.wikipedia.org/wiki/Value-added_tax "Value-added tax") [Digital goods](https://en.wikipedia.org/wiki/Taxation_of_digital_goods "Taxation of digital goods") [Dividend](https://en.wikipedia.org/wiki/Dividend_tax "Dividend tax") [Environmental tax](https://en.wikipedia.org/wiki/Environmental_tax "Environmental tax") [Carbon](https://en.wikipedia.org/wiki/Carbon_tax "Carbon tax") [Eco-tariff](https://en.wikipedia.org/wiki/Eco-tariff "Eco-tariff") [Landfill](https://en.wikipedia.org/wiki/Landfill_tax "Landfill tax") [Natural resources consumption](https://en.wikipedia.org/wiki/Natural_resources_consumption_tax "Natural resources consumption tax") [Severance](https://en.wikipedia.org/wiki/Severance_tax "Severance tax") [Steering](https://en.wikipedia.org/wiki/Steering_tax "Steering tax") [Stumpage](https://en.wikipedia.org/wiki/Stumpage "Stumpage") [Excise](https://en.wikipedia.org/wiki/Excise "Excise") [Alcohol](https://en.wikipedia.org/wiki/Alcohol_tax "Alcohol tax") [Fat](https://en.wikipedia.org/wiki/Fat_tax "Fat tax") [Meat](https://en.wikipedia.org/wiki/Meat_tax "Meat tax") [Sin](https://en.wikipedia.org/wiki/Sin_tax "Sin tax") [Sugary drink](https://en.wikipedia.org/wiki/Sugary_drink_tax "Sugary drink tax") [Tobacco](https://en.wikipedia.org/wiki/Tobacco_taxation "Tobacco taxation") [General](https://en.wikipedia.org/wiki/Consolidated_Fund "Consolidated Fund") [Georgist](https://en.wikipedia.org/wiki/Georgism "Georgism") [Gift](https://en.wikipedia.org/wiki/Gift_tax "Gift tax") [Gross receipts](https://en.wikipedia.org/wiki/Gross_receipts_tax "Gross receipts tax") [Hidden](https://en.wikipedia.org/wiki/Hidden_tax "Hidden tax") [Hypothecated](https://en.wikipedia.org/wiki/Hypothecated_tax "Hypothecated tax") [Income](https://en.wikipedia.org/wiki/Income_tax "Income tax") [Inheritance (estate)](https://en.wikipedia.org/wiki/Inheritance_tax "Inheritance tax") [Land value](https://en.wikipedia.org/wiki/Land_value_tax "Land value tax") [Luxury](https://en.wikipedia.org/wiki/Luxury_tax "Luxury tax") [Mining](https://en.wikipedia.org/wiki/Mining_taxation "Mining taxation") [On childlessness](https://en.wikipedia.org/wiki/Tax_on_childlessness "Tax on childlessness") [Payroll](https://en.wikipedia.org/wiki/Payroll_tax "Payroll tax") [Pigouvian](https://en.wikipedia.org/wiki/Pigouvian_tax "Pigouvian tax") [Property](https://en.wikipedia.org/wiki/Property_tax "Property tax") [Resource rent](https://en.wikipedia.org/wiki/Resource_rent_tax "Resource rent tax") [Single](https://en.wikipedia.org/wiki/Single_tax "Single tax") [Stealth](https://en.wikipedia.org/wiki/Stealth_tax "Stealth tax") [Surtax](https://en.wikipedia.org/wiki/Surtax "Surtax") [Turnover](https://en.wikipedia.org/wiki/Turnover_tax "Turnover tax") [Use](https://en.wikipedia.org/wiki/Use_tax "Use tax") [User charge](https://en.wikipedia.org/wiki/User_charge "User charge")/[fee](https://en.wikipedia.org/wiki/User_fee "User fee") [Congestion](https://en.wikipedia.org/wiki/Congestion_pricing "Congestion pricing") [Fuel](https://en.wikipedia.org/wiki/Fuel_tax "Fuel tax") [Road](https://en.wikipedia.org/wiki/Road_pricing "Road pricing")/[GNSS](https://en.wikipedia.org/wiki/GNSS_road_pricing "GNSS road pricing") [Toll](https://en.wikipedia.org/wiki/Toll_\(fee\) "Toll (fee)") [Vehicle miles traveled](https://en.wikipedia.org/wiki/Vehicle_miles_traveled_tax "Vehicle miles traveled tax") [Corporate profit](https://en.wikipedia.org/wiki/Corporate_tax "Corporate tax") [Excess profits](https://en.wikipedia.org/wiki/Excess_profits_tax "Excess profits tax") [Windfall](https://en.wikipedia.org/wiki/Windfall_tax "Windfall tax") [Negative (income)](https://en.wikipedia.org/wiki/Negative_income_tax "Negative income tax") [Wealth](https://en.wikipedia.org/wiki/Wealth_tax "Wealth tax") |
| [International](https://en.wikipedia.org/wiki/International_taxation "International taxation") [Financial transaction tax](https://en.wikipedia.org/wiki/Financial_transaction_tax "Financial transaction tax") [ATTAC](https://en.wikipedia.org/wiki/Association_for_the_Taxation_of_Financial_Transactions_and_for_Citizens%27_Action "Association for the Taxation of Financial Transactions and for Citizens' Action") [Currency transaction tax](https://en.wikipedia.org/wiki/Currency_transaction_tax "Currency transaction tax") [European Union Common Consolidated Corporate Tax Base](https://en.wikipedia.org/wiki/Common_Consolidated_Corporate_Tax_Base "Common Consolidated Corporate Tax Base") (CCCTB) [Global minimum corporate tax rate](https://en.wikipedia.org/wiki/Global_minimum_corporate_tax_rate "Global minimum corporate tax rate") [Robin Hood tax](https://en.wikipedia.org/wiki/Robin_Hood_tax "Robin Hood tax") [Tobin tax](https://en.wikipedia.org/wiki/Tobin_tax "Tobin tax") [Spahn tax](https://en.wikipedia.org/wiki/Spahn_tax "Spahn tax") [Tax equalization](https://en.wikipedia.org/wiki/Tax_equalization "Tax equalization") [Tax treaty](https://en.wikipedia.org/wiki/Tax_treaty "Tax treaty") [Exchange of Information](https://en.wikipedia.org/wiki/Exchange_of_Information "Exchange of Information") [Permanent establishment](https://en.wikipedia.org/wiki/Permanent_establishment "Permanent establishment") [Transfer pricing](https://en.wikipedia.org/wiki/Transfer_pricing "Transfer pricing") [European Union FTT](https://en.wikipedia.org/wiki/European_Union_financial_transaction_tax "European Union financial transaction tax") [Foreign revenue rule](https://en.wikipedia.org/wiki/Rule_against_foreign_revenue_enforcement "Rule against foreign revenue enforcement") |
| [Trade](https://en.wikipedia.org/wiki/Trade "Trade") [Custom](https://en.wikipedia.org/wiki/Customs "Customs") [Duty](https://en.wikipedia.org/wiki/Duty_\(economics\) "Duty (economics)") [Tariff](https://en.wikipedia.org/wiki/Tariff "Tariff") [Import](https://en.wikipedia.org/wiki/Import "Import") [Export](https://en.wikipedia.org/wiki/Export "Export") [Tariff war](https://en.wikipedia.org/wiki/Trade_war "Trade war") [Free trade](https://en.wikipedia.org/wiki/Free_trade "Free trade") [Free-trade zone](https://en.wikipedia.org/wiki/Free-trade_zone "Free-trade zone") [Trade agreement](https://en.wikipedia.org/wiki/Trade_agreement "Trade agreement") [ATA Carnet](https://en.wikipedia.org/wiki/ATA_Carnet "ATA Carnet") |
| Academic |
| [Mihir A. Desai](https://en.wikipedia.org/wiki/Mihir_A._Desai "Mihir A. Desai") [Dhammika Dharmapala](https://en.wikipedia.org/wiki/Dhammika_Dharmapala "Dhammika Dharmapala") [James R. Hines Jr.](https://en.wikipedia.org/wiki/James_R._Hines_Jr. "James R. Hines Jr.") [Ronen Palan](https://en.wikipedia.org/wiki/Ronen_Palan "Ronen Palan") [Joel Slemrod](https://en.wikipedia.org/wiki/Joel_Slemrod "Joel Slemrod") [Gabriel Zucman](https://en.wikipedia.org/wiki/Gabriel_Zucman "Gabriel Zucman") |
| Advocacy groups |
| [Institute on Taxation and Economic Policy](https://en.wikipedia.org/wiki/Institute_on_Taxation_and_Economic_Policy "Institute on Taxation and Economic Policy") (ITEP) [Oxfam](https://en.wikipedia.org/wiki/Oxfam "Oxfam") (UK) [Tax Foundation](https://en.wikipedia.org/wiki/Tax_Foundation "Tax Foundation") (US) [Tax Justice Network](https://en.wikipedia.org/wiki/Tax_Justice_Network "Tax Justice Network") (TJN) [Tax Policy Center](https://en.wikipedia.org/wiki/Tax_Policy_Center "Tax Policy Center") (US) |
| [Religious](https://en.wikipedia.org/wiki/Religion "Religion") [Church tax](https://en.wikipedia.org/wiki/Church_tax "Church tax") [Eight per thousand](https://en.wikipedia.org/wiki/Eight_per_thousand "Eight per thousand") [Teind](https://en.wikipedia.org/wiki/Teind "Teind") [Tithe](https://en.wikipedia.org/wiki/Tithe "Tithe") [Fiscus Judaicus](https://en.wikipedia.org/wiki/Fiscus_Judaicus "Fiscus Judaicus") [Leibzoll](https://en.wikipedia.org/wiki/Leibzoll "Leibzoll") [Temple tax](https://en.wikipedia.org/wiki/Temple_tax "Temple tax") [Tolerance tax](https://en.wikipedia.org/wiki/Tolerance_tax "Tolerance tax") [Jizya](https://en.wikipedia.org/wiki/Jizya "Jizya") [Kharaj](https://en.wikipedia.org/wiki/Kharaj "Kharaj") [Khums](https://en.wikipedia.org/wiki/Khums "Khums") [Nisab](https://en.wikipedia.org/wiki/Nisab "Nisab") [Zakat](https://en.wikipedia.org/wiki/Zakat "Zakat") |
| All countries |
| [List of countries by tax rates](https://en.wikipedia.org/wiki/List_of_countries_by_tax_rates "List of countries by tax rates") [Tax revenue to GDP ratio](https://en.wikipedia.org/wiki/List_of_countries_by_tax_revenue_to_GDP_ratio "List of countries by tax revenue to GDP ratio") [Tax rates in Europe](https://en.wikipedia.org/wiki/Tax_rates_in_Europe "Tax rates in Europe") |
| Individual countries |
| [Albania](https://en.wikipedia.org/wiki/Taxation_in_Albania "Taxation in Albania") [Algeria](https://en.wikipedia.org/wiki/Taxation_in_Algeria "Taxation in Algeria") [Argentina](https://en.wikipedia.org/wiki/Taxation_in_Argentina "Taxation in Argentina") [Armenia](https://en.wikipedia.org/wiki/Taxation_in_Armenia "Taxation in Armenia") [Australia](https://en.wikipedia.org/wiki/Taxation_in_Australia "Taxation in Australia") [Azerbaijan](https://en.wikipedia.org/wiki/Taxation_in_Azerbaijan "Taxation in Azerbaijan") [Bangladesh](https://en.wikipedia.org/wiki/Taxation_in_Bangladesh "Taxation in Bangladesh") [Bhutan](https://en.wikipedia.org/wiki/Taxation_in_Bhutan "Taxation in Bhutan") [Brazil](https://en.wikipedia.org/wiki/Taxation_in_Brazil "Taxation in Brazil") [Bulgaria](https://en.wikipedia.org/wiki/Taxation_in_Bulgaria "Taxation in Bulgaria") [BVI](https://en.wikipedia.org/wiki/Taxation_in_the_British_Virgin_Islands "Taxation in the British Virgin Islands") [Canada](https://en.wikipedia.org/wiki/Taxation_in_Canada "Taxation in Canada") [China](https://en.wikipedia.org/wiki/Taxation_in_China "Taxation in China") [Colombia](https://en.wikipedia.org/wiki/Taxation_in_Colombia "Taxation in Colombia") [Croatia](https://en.wikipedia.org/wiki/Taxation_in_Croatia "Taxation in Croatia") [Denmark](https://en.wikipedia.org/wiki/Taxation_in_Denmark "Taxation in Denmark") [Finland](https://en.wikipedia.org/wiki/Taxation_in_Finland "Taxation in Finland") [France](https://en.wikipedia.org/wiki/Taxation_in_France "Taxation in France") [Germany](https://en.wikipedia.org/wiki/Taxation_in_Germany "Taxation in Germany") [Greece](https://en.wikipedia.org/wiki/Taxation_in_Greece "Taxation in Greece") [Hong Kong](https://en.wikipedia.org/wiki/Taxation_in_Hong_Kong "Taxation in Hong Kong") [Iceland](https://en.wikipedia.org/wiki/Taxation_in_Iceland "Taxation in Iceland") [India](https://en.wikipedia.org/wiki/Taxation_in_India "Taxation in India") [Indonesia](https://en.wikipedia.org/wiki/Taxation_in_Indonesia "Taxation in Indonesia") [Iran](https://en.wikipedia.org/wiki/Taxation_in_Iran "Taxation in Iran") [Ireland](https://en.wikipedia.org/wiki/Taxation_in_the_Republic_of_Ireland "Taxation in the Republic of Ireland") [Israel](https://en.wikipedia.org/wiki/Taxation_in_Israel "Taxation in Israel") [Italy](https://en.wikipedia.org/wiki/Taxation_in_Italy "Taxation in Italy") [Japan](https://en.wikipedia.org/wiki/Taxation_in_Japan "Taxation in Japan") [Kazakhstan](https://en.wikipedia.org/wiki/Taxation_in_Kazakhstan "Taxation in Kazakhstan") [Lithuania](https://en.wikipedia.org/wiki/Taxation_in_Lithuania "Taxation in Lithuania") [Malta](https://en.wikipedia.org/wiki/Taxation_in_Malta "Taxation in Malta") [Morocco](https://en.wikipedia.org/wiki/Taxation_in_Morocco "Taxation in Morocco") [Namibia](https://en.wikipedia.org/wiki/Taxation_in_Namibia "Taxation in Namibia") [Netherlands](https://en.wikipedia.org/wiki/Taxation_in_the_Netherlands "Taxation in the Netherlands") [New Zealand](https://en.wikipedia.org/wiki/Taxation_in_New_Zealand "Taxation in New Zealand") [Norway](https://en.wikipedia.org/wiki/Taxation_in_Norway "Taxation in Norway") [Pakistan](https://en.wikipedia.org/wiki/Taxation_in_Pakistan "Taxation in Pakistan") [Palestine](https://en.wikipedia.org/wiki/Taxation_in_the_State_of_Palestine "Taxation in the State of Palestine") [Peru](https://en.wikipedia.org/wiki/Taxation_in_Peru "Taxation in Peru") [Philippines](https://en.wikipedia.org/wiki/Taxation_in_the_Philippines "Taxation in the Philippines") [Poland](https://en.wikipedia.org/wiki/Taxation_in_Poland "Taxation in Poland") [Portugal](https://en.wikipedia.org/wiki/Taxation_in_Portugal "Taxation in Portugal") [Russia](https://en.wikipedia.org/wiki/Taxation_in_Russia "Taxation in Russia") [South Africa](https://en.wikipedia.org/wiki/Taxation_in_South_Africa "Taxation in South Africa") [Sri Lanka](https://en.wikipedia.org/wiki/Taxation_in_Sri_Lanka "Taxation in Sri Lanka") [Sweden](https://en.wikipedia.org/wiki/Taxation_in_Sweden "Taxation in Sweden") [Switzerland](https://en.wikipedia.org/wiki/Taxation_in_Switzerland "Taxation in Switzerland") [Taiwan](https://en.wikipedia.org/wiki/Taxation_in_Taiwan "Taxation in Taiwan") [Tanzania](https://en.wikipedia.org/wiki/Taxation_in_Tanzania "Taxation in Tanzania") [United Arab Emirates](https://en.wikipedia.org/wiki/Taxation_in_the_United_Arab_Emirates "Taxation in the United Arab Emirates") [United Kingdom](https://en.wikipedia.org/wiki/Taxation_in_the_United_Kingdom "Taxation in the United Kingdom") [United States](https://en.wikipedia.org/wiki/Taxation_in_the_United_States "Taxation in the United States") [Uruguay](https://en.wikipedia.org/wiki/Taxation_in_Uruguay "Taxation in Uruguay") |
| [](https://en.wikipedia.org/wiki/File:Emblem-money.svg) [Business portal](https://en.wikipedia.org/wiki/Portal:Business "Portal:Business")  [Money portal](https://en.wikipedia.org/wiki/Portal:Money "Portal:Money") |
| [v](https://en.wikipedia.org/wiki/Template:Taxation_sidebar "Template:Taxation sidebar") [t](https://en.wikipedia.org/wiki/Template_talk:Taxation_sidebar "Template talk:Taxation sidebar") [e](https://en.wikipedia.org/wiki/Special:EditPage/Template:Taxation_sidebar "Special:EditPage/Template:Taxation sidebar") |
**Tax avoidance** is the legal use of the [tax](https://en.wikipedia.org/wiki/Tax "Tax") regime in a single territory to one's own advantage to reduce the amount of tax that is payable. A [tax shelter](https://en.wikipedia.org/wiki/Tax_shelter "Tax shelter") is one type of tax avoidance, and [tax havens](https://en.wikipedia.org/wiki/Tax_havens "Tax havens") are jurisdictions that facilitate reduced taxes.[\[1\]](https://en.wikipedia.org/wiki/Tax_avoidance#cite_note-1) Tax avoidance should not be confused with [tax evasion](https://en.wikipedia.org/wiki/Tax_evasion "Tax evasion"), which is illegal.
Forms of tax avoidance that use legal tax laws in ways not necessarily intended by the government are often criticized in the [court of public opinion](https://en.wikipedia.org/wiki/Court_of_public_opinion "Court of public opinion") and by [journalists](https://en.wikipedia.org/wiki/Journalists "Journalists"). Many [businesses](https://en.wikipedia.org/wiki/Businesses "Businesses") pay little or no tax, and some experience a [backlash](https://en.wikipedia.org/wiki/Backlash_\(sociology\) "Backlash (sociology)") when their tax avoidance becomes known to the public. Conversely, benefiting from tax laws in ways that were intended by governments is sometimes referred to as **tax planning**.[\[2\]](https://en.wikipedia.org/wiki/Tax_avoidance#cite_note-2) The [World Bank](https://en.wikipedia.org/wiki/World_Bank "World Bank")'s [World Development Report](https://en.wikipedia.org/wiki/World_Development_Report "World Development Report") 2019 on the future of work supports increased government efforts to curb tax avoidance as part of a new [social contract](https://en.wikipedia.org/wiki/Social_contract "Social contract") focused on [human capital](https://en.wikipedia.org/wiki/Human_capital "Human capital") investments and expanded [social protection](https://en.wikipedia.org/wiki/Social_protection "Social protection").[\[3\]](https://en.wikipedia.org/wiki/Tax_avoidance#cite_note-3)
"Tax mitigation", "tax aggressive", "aggressive tax avoidance" or "tax neutral" schemes generally refer to multiterritory schemes that fall into the grey area between common and well-accepted tax avoidance, such as purchasing [municipal bonds](https://en.wikipedia.org/wiki/Municipal_bonds "Municipal bonds") in the United States, and tax evasion but are viewed by some as unethical, especially if they are involved in [profit-shifting](https://en.wikipedia.org/wiki/Base_erosion_and_profit_shifting "Base erosion and profit shifting") from high-tax to low-tax territories and territories recognised as tax havens.[\[4\]](https://en.wikipedia.org/wiki/Tax_avoidance#cite_note-4) Since 1995, trillions of dollars have been transferred from [OECD](https://en.wikipedia.org/wiki/OECD "OECD") and [developing countries](https://en.wikipedia.org/wiki/Developing_country "Developing country") into tax havens using these schemes.[\[5\]](https://en.wikipedia.org/wiki/Tax_avoidance#cite_note-5)
Laws known as a General Anti-Avoidance Rule (GAAR) statutes, which prohibit "aggressive" tax avoidance, have been passed in several countries and regions including Canada, Australia, New Zealand, South Africa, Norway, Hong Kong and the United Kingdom.[\[6\]](https://en.wikipedia.org/wiki/Tax_avoidance#cite_note-6)[\[7\]](https://en.wikipedia.org/wiki/Tax_avoidance#cite_note-UKGAAR-7) In addition, [judicial doctrines](https://en.wikipedia.org/wiki/Legal_doctrine "Legal doctrine") have accomplished the similar purpose, notably in the United States through the "business purpose" and "economic substance" doctrines established in *[Gregory v. Helvering](https://en.wikipedia.org/wiki/Gregory_v._Helvering "Gregory v. Helvering")* and in the United Kingdom in *[Ramsay](https://en.wikipedia.org/wiki/The_Ramsay_Principle "The Ramsay Principle")*. The specifics may vary according to jurisdiction, but such rules invalidate tax avoidance that is technically legal but is not for a business purpose or is in violation of the spirit of the tax code.[\[8\]](https://en.wikipedia.org/wiki/Tax_avoidance#cite_note-8)
The term "avoidance" has also been used in the tax regulations\[*examples and source needed*\] of some jurisdictions to distinguish tax avoidance foreseen by the legislators from tax avoidance exploiting [loopholes](https://en.wikipedia.org/wiki/Tax_break "Tax break") in the law such as [like-kind exchanges](https://en.wikipedia.org/wiki/Like-kind_exchange "Like-kind exchange").[\[9\]](https://en.wikipedia.org/wiki/Tax_avoidance#cite_note-9)[\[10\]](https://en.wikipedia.org/wiki/Tax_avoidance#cite_note-NYT01613-10)\[*correct example needed*\] The [US Supreme Court](https://en.wikipedia.org/wiki/US_Supreme_Court "US Supreme Court") has stated, "The legal right of an individual to decrease the amount of what would otherwise be his taxes or altogether avoid them, by means which the law permits, cannot be doubted".
Tax evasion, on the other hand, is the general term for efforts by individuals, corporations, [trusts](https://en.wikipedia.org/wiki/Trust_\(property\) "Trust (property)") and other entities to evade taxes by illegal means.
According to [Joseph Stiglitz](https://en.wikipedia.org/wiki/Joseph_Stiglitz "Joseph Stiglitz") (1986), there are three principles of tax avoidance: postponement of taxes, tax arbitrage across individuals facing different tax brackets, and tax arbitrage across income streams facing different tax treatment. Many tax avoidance devices include a combination of the three principles.
The postponement of taxes is the present discounted value of postponed tax is much less than of a tax currently paid. Tax arbitrage across individuals facing different tax brackets or the same individual facing different marginal tax rates at different times is an effective method of reducing tax liabilities within a family. However, according to Stiglitz (1986), differential tax rates may also lead to transactions among individuals in different brackets leading to “tax induced transactions”. The last principle is the tax arbitrage across income streams facing different tax treatment.[\[11\]](https://en.wikipedia.org/wiki/Tax_avoidance#cite_note-11)
## Anti-avoidance measures
\[[edit](https://en.wikipedia.org/w/index.php?title=Tax_avoidance&action=edit§ion=1 "Edit section: Anti-avoidance measures")\]
An anti-avoidance measure is a rule that prevents the reduction of tax by legal arrangements, where those arrangements are put in place purely to reduce tax, and would not otherwise be regarded as a reasonable course of action.
### Legislative measures
\[[edit](https://en.wikipedia.org/w/index.php?title=Tax_avoidance&action=edit§ion=2 "Edit section: Legislative measures")\]
Two kind of anti-avoidance measures exist; General Anti Avoidance Rules (GAAR) and Specific Anti Avoidance Rules (SAAR). The GAAR implies a set of generic anti-avoidance rules, while SAAR targets a specific avoidance practice or technique. Also, there is a set of bilateral measures pursued thorough treaties or double taxation agreements (DTAAs), this can be done via various clauses.[\[12\]](https://en.wikipedia.org/wiki/Tax_avoidance#cite_note-Anti-Avoidance_Measures-12)
### Judicial anti-avoidance measures
\[[edit](https://en.wikipedia.org/w/index.php?title=Tax_avoidance&action=edit§ion=3 "Edit section: Judicial anti-avoidance measures")\]
Courts around the world have played an important role in developing SAAR and GAAR measures. But the two guiding principles in judicial anti-avoidance are business purpose rule and substance over form rule. The business purpose rule states that the transaction must serve as a business purpose. Which means that mere tax advantage cannot be the main business purpose. On the other hand, the substance over form principle is wider than the business rule and it is defined by the OECD as the ‘prevalence of economic or social reality over the literal wording of legal provisions’ (Ostwal, T.P.; Vijayaraghavan, Vikram 2010).[\[12\]](https://en.wikipedia.org/wiki/Tax_avoidance#cite_note-Anti-Avoidance_Measures-12)
### EU Anti-Tax Avoidance Package
\[[edit](https://en.wikipedia.org/w/index.php?title=Tax_avoidance&action=edit§ion=4 "Edit section: EU Anti-Tax Avoidance Package")\]
The Anti-Tax Avoidance Package is part of the European Commission's agenda as an effort to implement a more effective corporate taxation in the European Union. This package was implemented in 2016 and offers measures to prevent aggressive tax planning and encourage of tax transparency among others. The Anti- Tax Avoidance Package counts with an Anti-Tax avoidance directive, recommendation on Tax Treaties, revised administrative cooperation directive and communication on external strategy.[\[13\]](https://en.wikipedia.org/wiki/Tax_avoidance#cite_note-13)
**Anti-Tax Avoidance Directive (ATAD)**: On 20 June 2016 the European Council adopted the Directive (EU) 2016/1164 which contains five legally binding anti-abuse measures that should be applied as common forms of aggressive tax legislations. The member States must have applied these measures as from 1 January 2019. ATAD contains the following five anti-abuse measures: 1. Interest deductibility, to discourage artificial debt arrangements which are design to minimise taxes, 2. Exit taxation, for preventing the avoidance of taxes when companies are re-locating assets, 3. Incorporation of the GAAR for disregarding of non-genuine arrangements, 4. Controlled Foreign Company Rule (CFC), to deter that the profit is transferred to a low or no tax country, 5. Switchover rule, to prevent double non-taxation.[\[14\]](https://en.wikipedia.org/wiki/Tax_avoidance#cite_note-14)
### Anti-avoidance measures by country
\[[edit](https://en.wikipedia.org/w/index.php?title=Tax_avoidance&action=edit§ion=5 "Edit section: Anti-avoidance measures by country")\]
#### Australia
\[[edit](https://en.wikipedia.org/w/index.php?title=Tax_avoidance&action=edit§ion=6 "Edit section: Australia")\]
Australia has a strong tax regime regarding avoidance which applies to large corporate groups, underpinned by the General Anti- Avoidance Rule (GAAR) adopted since 1981 with the Income Tax Act.[\[15\]](https://en.wikipedia.org/wiki/Tax_avoidance#cite_note-Office-15) The multinational anti-avoidance law (MAAL) is an extension of Australia's general anti-avoidance rules. This aims to make multinational enterprises pay their fair share of tax of the profits received and earned in Australia[\[15\]](https://en.wikipedia.org/wiki/Tax_avoidance#cite_note-Office-15)
#### United States
\[[edit](https://en.wikipedia.org/w/index.php?title=Tax_avoidance&action=edit§ion=7 "Edit section: United States")\]
Since 1980s there have been six major tax reforms in the US. The first one, in 1981, introduced a variety of tax loopholes. With this, the tax shelter industry boomed, giving rise to a demand for tax reform. The 1986 tax reform was the most accurate attempt at reducing tax avoidance, but then the next reforms of 1993 and 1997 opened new opportunities for tax avoidance and increased incentives of tax avoidance.[\[16\]](https://en.wikipedia.org/wiki/Tax_avoidance#cite_note-:0-16) The 1986 tax law reduced the demand for tax shelters and the opportunities for tax avoidance by constricting the gap between regular rates and the minimum tax rates. Lowering the top marginal rates, restricting the ability to use losses on just one type of income for balancing gains on other income and finally by taxing capital gains with full rates. There was another tax act in 1993, in which the alternative minimum tax rates were increased, also the regular rates, and an increase in the absolute gap for upper-income people. In the 1997 act, a gap between the rates at which capital gains and ordinary income was introduced to all taxpayers. During the 2001 and 2003 tax acts introduced more opportunities for tax avoidance because the gap between the capital gains and ordinary income tax remained the same as both rates were reduced by 5%. Finally, in the 2013 tax act, increased the tax on capital gains and ordinary income to 20 and 39.6% respectively.[\[16\]](https://en.wikipedia.org/wiki/Tax_avoidance#cite_note-:0-16)
## Methods
\[[edit](https://en.wikipedia.org/w/index.php?title=Tax_avoidance&action=edit§ion=8 "Edit section: Methods")\]
### Country of residence
\[[edit](https://en.wikipedia.org/w/index.php?title=Tax_avoidance&action=edit§ion=9 "Edit section: Country of residence")\]
A company may choose to avoid taxes by establishing their company or subsidiaries in an [offshore jurisdiction](https://en.wikipedia.org/wiki/Offshore_financial_centre "Offshore financial centre") (see [offshore company](https://en.wikipedia.org/wiki/Offshore_company "Offshore company") and [offshore trust](https://en.wikipedia.org/wiki/Offshore_trust "Offshore trust")). Individuals may also avoid tax by moving their [tax residence](https://en.wikipedia.org/wiki/Tax_residence "Tax residence") to a [tax haven](https://en.wikipedia.org/wiki/Tax_haven "Tax haven"), such as [Monaco](https://en.wikipedia.org/wiki/Monaco "Monaco"), or by becoming [perpetual travelers](https://en.wikipedia.org/wiki/Perpetual_traveler "Perpetual traveler"). They may also reduce their tax by moving to a country with lower tax rates.
However, a small number of countries [tax their citizens on their worldwide income](https://en.wikipedia.org/wiki/International_taxation#Citizenship "International taxation") regardless of where they reside. As of 2012[\[update\]](https://en.wikipedia.org/w/index.php?title=Tax_avoidance&action=edit), only the United States and [Eritrea](https://en.wikipedia.org/wiki/Eritrea "Eritrea") have such a practice, whilst Finland, France, Hungary, Italy\[*[citation needed](https://en.wikipedia.org/wiki/Wikipedia:Citation_needed "Wikipedia:Citation needed")*\] and Spain apply it in limited circumstances. In cases such as the US, taxation cannot be avoided by simply transferring assets or moving abroad.[\[17\]](https://en.wikipedia.org/wiki/Tax_avoidance#cite_note-17)
The United States is unlike almost all other countries in that its citizens and permanent residents are subject to [U.S. federal income tax](https://en.wikipedia.org/wiki/Income_tax_in_the_United_States "Income tax in the United States") on their worldwide income even if they reside temporarily or permanently outside the United States. U.S. citizens therefore cannot avoid U.S. taxes simply by emigrating from the U.S. According to *[Forbes](https://en.wikipedia.org/wiki/Forbes "Forbes")* magazine some citizens choose to [give up](https://en.wikipedia.org/wiki/Renunciation_of_citizenship#United_States "Renunciation of citizenship") their [United States citizenship](https://en.wikipedia.org/wiki/United_States_citizenship "United States citizenship") rather than be subject to the [U.S. tax system](https://en.wikipedia.org/wiki/Taxation_in_the_United_States "Taxation in the United States");[\[18\]](https://en.wikipedia.org/wiki/Tax_avoidance#cite_note-18) but U.S. citizens who reside (or spend long periods of time) outside the U.S. may be able to exclude some salaried income earned overseas (but not other types of income unless specified in a bilateral tax treaty) from income in computing the U.S. federal income tax. The 2015 limit on the amount that can be excluded is US\$100,800. In addition, taxpayers can exclude or deduct certain foreign housing amounts. They may also be entitled to exclude from income the value of meals and lodging provided by their employer.[\[19\]](https://en.wikipedia.org/wiki/Tax_avoidance#cite_note-19) Some American parents do not register their children's birth abroad with American authorities, because they do not want their children to be required to report all earnings to the IRS and pay American taxes for their entire lives, even if they never visit the United States.[\[20\]](https://en.wikipedia.org/wiki/Tax_avoidance#cite_note-20)
### Double taxation
\[[edit](https://en.wikipedia.org/w/index.php?title=Tax_avoidance&action=edit§ion=10 "Edit section: Double taxation")\]
Most countries impose taxes on income earned or gains realized within that country regardless of the country of residence of the person or firm. Most countries have entered into bilateral [double taxation](https://en.wikipedia.org/wiki/Double_taxation "Double taxation") treaties with many other countries to avoid taxing nonresidents twice—once where the income is earned and again in the country of residence (and perhaps, for U.S. citizens, taxed yet again in the country of citizenship)—however, there are relatively few double-taxation treaties with countries regarded as tax havens.[\[21\]](https://en.wikipedia.org/wiki/Tax_avoidance#cite_note-21) To avoid tax, it is usually not enough to simply move one's assets to a tax haven. One must also personally move to a tax haven (and, for U.S. citizens, renounce one's citizenship) to avoid tax.
### Legal entities
\[[edit](https://en.wikipedia.org/w/index.php?title=Tax_avoidance&action=edit§ion=11 "Edit section: Legal entities")\]
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|  | The examples and perspective in this section **may not represent a [worldwide view](https://en.wikipedia.org/wiki/Wikipedia:WikiProject_Countering_systemic_bias "Wikipedia:WikiProject Countering systemic bias") of the subject**. You may [improve this section](https://en.wikipedia.org/w/index.php?title=Tax_avoidance&action=edit), discuss the issue on the [talk page](https://en.wikipedia.org/wiki/Talk:Tax_avoidance "Talk:Tax avoidance"), or create a new section, as appropriate. *(April 2015)* *([Learn how and when to remove this message](https://en.wikipedia.org/wiki/Help:Maintenance_template_removal "Help:Maintenance template removal"))* |
Without changing country of residence (or, if a U.S. citizen, without giving up one's citizenship), personal taxation may be legally avoided by the creation of a separate [legal entity](https://en.wikipedia.org/wiki/Juristic_person "Juristic person") to which one's property is donated. The separate legal entity is often a [company](https://en.wikipedia.org/wiki/Company_\(law\) "Company (law)"), [trust](https://en.wikipedia.org/wiki/Trust_company "Trust company"), or [foundation](https://en.wikipedia.org/wiki/Foundation_\(nonprofit_organization\) "Foundation (nonprofit organization)"). These may also be located offshore, such as in the case of many [private foundations](https://en.wikipedia.org/wiki/Private_foundation "Private foundation"). Assets are transferred to the new company or trust so that gains may be realized, or income earned, within this legal entity rather than earned by the original owner. If assets are later transferred back to an individual, then [capital gains taxes](https://en.wikipedia.org/wiki/Capital_gains_tax "Capital gains tax") would apply on all profits. Also [income tax](https://en.wikipedia.org/wiki/Income_tax "Income tax") would still be due on any [salary](https://en.wikipedia.org/wiki/Salary "Salary") or [dividend](https://en.wikipedia.org/wiki/Dividend "Dividend") drawn from the legal entity.
For a [settlor](https://en.wikipedia.org/wiki/Settlor "Settlor") (creator of a trust) to avoid tax there may be restrictions on the type, purpose and beneficiaries of the trust. For example, the settlor of the trust may not be allowed to be a [trustee](https://en.wikipedia.org/wiki/Trustee "Trustee") or even a [beneficiary](https://en.wikipedia.org/wiki/Beneficiary_\(trust\) "Beneficiary (trust)") and may thus lose control of the assets transferred and/or may be unable to benefit from them.
### Legal vagueness
\[[edit](https://en.wikipedia.org/w/index.php?title=Tax_avoidance&action=edit§ion=12 "Edit section: Legal vagueness")\]
Tax results depend on definitions of legal terms which are usually vague. For example, vagueness of the distinction between "business expenses" and "personal expenses" is of much concern for taxpayers and tax authorities. More generally, any term of tax law has a vague penumbra, and is a potential source of tax avoidance.[\[22\]](https://en.wikipedia.org/wiki/Tax_avoidance#cite_note-22)
### Tax shelters
\[[edit](https://en.wikipedia.org/w/index.php?title=Tax_avoidance&action=edit§ion=13 "Edit section: Tax shelters")\]
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|  | The examples and perspective in this section **may not represent a [worldwide view](https://en.wikipedia.org/wiki/Wikipedia:WikiProject_Countering_systemic_bias "Wikipedia:WikiProject Countering systemic bias") of the subject**. You may [improve this section](https://en.wikipedia.org/w/index.php?title=Tax_avoidance&action=edit), discuss the issue on the [talk page](https://en.wikipedia.org/wiki/Talk:Tax_avoidance "Talk:Tax avoidance"), or create a new section, as appropriate. *(April 2015)* *([Learn how and when to remove this message](https://en.wikipedia.org/wiki/Help:Maintenance_template_removal "Help:Maintenance template removal"))* |
[Tax shelters](https://en.wikipedia.org/wiki/Tax_shelter "Tax shelter") are investments that allow, and purport to allow, a reduction in one's income tax liability. Although things such as home ownership, pension plans, and Individual Retirement Accounts (IRAs) can be broadly considered "tax shelters", insofar as funds in them are not taxed, provided that they are held within the Individual Retirement Account for the required amount of time, the term "tax shelter" was originally used to describe primarily certain investments made in the form of limited partnerships, some of which were deemed by the U.S. Internal Revenue Service to be abusive.
The Internal Revenue Service and the [United States Department of Justice](https://en.wikipedia.org/wiki/United_States_Department_of_Justice "United States Department of Justice") have recently teamed up to crack down on abusive tax shelters. In 2003 the Senate's Permanent Subcommittee on Investigations held hearings about tax shelters which are entitled *U.S. tax shelter industry: the role of accountants, lawyers, and financial professionals*. Many of these tax shelters were designed and provided by accountants at the large American accounting firms.
Examples of U.S. tax shelters include: Foreign Leveraged Investment Program (FLIP) and Offshore Portfolio Investment Strategy (OPIS). Both were devised by partners at the accounting firm, KPMG. These tax shelters were also known as "basis shifts" or "defective redemptions."
Prior to 1987, passive investors in certain limited partnerships (such as [oil exploration](https://en.wikipedia.org/wiki/Oil_exploration "Oil exploration") or real estate investment ventures) were allowed to use the passive losses (if any) of the partnership (i.e., losses generated by partnership operations in which the investor took no material active part) to offset the investors' income, lowering the amount of income tax that otherwise would be owed by the investor. These partnerships could be structured so that an investor in a high tax bracket could obtain a net economic benefit from partnership-generated passive losses.
In the [Tax Reform Act of 1986](https://en.wikipedia.org/wiki/Tax_Reform_Act_of_1986 "Tax Reform Act of 1986") the U.S. Congress introduced the limitation (under [26 U.S.C.](https://en.wikipedia.org/wiki/Internal_Revenue_Code "Internal Revenue Code") [§ 469](https://www.law.cornell.edu/uscode/text/26/469)) on the deduction of passive losses and the use of passive activity tax credits. The 1986 Act also changed the "at risk" loss rules of [26 U.S.C.](https://en.wikipedia.org/wiki/Internal_Revenue_Code "Internal Revenue Code") [§ 465](https://www.law.cornell.edu/uscode/text/26/465). Coupled with the hobby loss rules ([26 U.S.C.](https://en.wikipedia.org/wiki/Internal_Revenue_Code "Internal Revenue Code") [§ 183](https://www.law.cornell.edu/uscode/text/26/183)), the changes greatly reduced tax avoidance by taxpayers engaged in activities only to generate deductible losses.
### Trusts
\[[edit](https://en.wikipedia.org/w/index.php?title=Tax_avoidance&action=edit§ion=14 "Edit section: Trusts")\]
Taxpayers normally subject to [estate taxes](https://en.wikipedia.org/wiki/Estate_tax "Estate tax") or [gift taxes](https://en.wikipedia.org/wiki/Gift_taxes "Gift taxes") can reduce their tax liability through the use of trusts. One such strategy, common among [high-net-worth individuals](https://en.wikipedia.org/wiki/High-net-worth_individual "High-net-worth individual"), is the [grantor retained annuity trust](https://en.wikipedia.org/wiki/Grantor_retained_annuity_trust "Grantor retained annuity trust"). Instead of passing assets directly through the estate to the heir, the taxpayer can place assets expected to grow in value in an [irrevocable trust](https://en.wikipedia.org/wiki/Irrevocable_trust "Irrevocable trust") that ultimately benefits the heir. While the original amount placed in the trust is subject to estate taxes, any [capital gains](https://en.wikipedia.org/wiki/Capital_gain "Capital gain") are passed to the heir without being subject to taxation.[\[23\]](https://en.wikipedia.org/wiki/Tax_avoidance#cite_note-23)
### Other
\[[edit](https://en.wikipedia.org/w/index.php?title=Tax_avoidance&action=edit§ion=15 "Edit section: Other")\]
[Share repurchases](https://en.wikipedia.org/wiki/Share_repurchase "Share repurchase") allow stockholders instead of paying [dividend tax](https://en.wikipedia.org/wiki/Dividend_tax "Dividend tax") to pay lower [capital gains taxes](https://en.wikipedia.org/wiki/Capital_gains_tax "Capital gains tax").[\[24\]](https://en.wikipedia.org/wiki/Tax_avoidance#cite_note-24)
## Tax avoiders
\[[edit](https://en.wikipedia.org/w/index.php?title=Tax_avoidance&action=edit§ion=16 "Edit section: Tax avoiders")\]
According to a 2022 study, 36% of the profits of multinational firms are shifted to tax havens.[\[25\]](https://en.wikipedia.org/wiki/Tax_avoidance#cite_note-:12-25) If the profits had been reallocated to their domestic source, "domestic profits would increase by about 20% in high-tax European Union countries, 10% in the United States, and 5% in developing countries, while they would fall by 55% in tax havens."[\[25\]](https://en.wikipedia.org/wiki/Tax_avoidance#cite_note-:12-25)
### United Kingdom
\[[edit](https://en.wikipedia.org/w/index.php?title=Tax_avoidance&action=edit§ion=17 "Edit section: United Kingdom")\]
[HMRC](https://en.wikipedia.org/wiki/HMRC "HMRC"), the UK tax collection agency, estimated that the overall cost of tax avoidance in the UK in 2016-17 was £1.7 billion, of which £0.7 billion was loss of income tax, National Insurance contributions and Capital Gains Tax. The rest came from loss of Corporation Tax, VAT and other direct taxes.[\[26\]](https://en.wikipedia.org/wiki/Tax_avoidance#cite_note-HMRCtaxgap-26) This compares to the wider tax gap (the difference between the amount of tax that should, in theory, be collected by HMRC, against what is actually collected) in that year of £33 billion.[\[26\]](https://en.wikipedia.org/wiki/Tax_avoidance#cite_note-HMRCtaxgap-26)
Figures published by the Tax Justice Network show that the UK had one of the lowest rates of tax losses due to profit shifting by multinational companies, with the fourth lowest rate out of 102 countries studied.[\[27\]](https://en.wikipedia.org/wiki/Tax_avoidance#cite_note-27) According to the figures, the UK lost £1 billion from profit shifting, around 0.04% of its GDP, coming behind Botswana (0.02%), Ecuador (0.02%) and Sweden (0.004%).[\[28\]](https://en.wikipedia.org/wiki/Tax_avoidance#cite_note-28)
#### Large companies accused of tax avoidance
\[[edit](https://en.wikipedia.org/w/index.php?title=Tax_avoidance&action=edit§ion=18 "Edit section: Large companies accused of tax avoidance")\]
In 2008 it was reported by [Private Eye](https://en.wikipedia.org/wiki/Private_Eye "Private Eye") that [Tesco](https://en.wikipedia.org/wiki/Tesco "Tesco") utilized offshore holding companies in Luxembourg and partnership agreements to reduce corporation tax liability by up to £50 million a year.[\[29\]](https://en.wikipedia.org/wiki/Tax_avoidance#cite_note-leigh-29) Another scheme previously identified by Private Eye involved depositing £1 billion in a Swiss partnership, and then loaning out that money to overseas Tesco stores, so that profit can be transferred indirectly through interest payments. This scheme is reported to remain in operation and is estimated to be costing the UK exchequer up to £20 million a year in corporation tax.[\[29\]](https://en.wikipedia.org/wiki/Tax_avoidance#cite_note-leigh-29)[\[30\]](https://en.wikipedia.org/wiki/Tax_avoidance#cite_note-30)
In 2011, [ActionAid](https://en.wikipedia.org/wiki/ActionAid "ActionAid") reported that 25% of the [FTSE 100](https://en.wikipedia.org/wiki/FTSE_100_Index "FTSE 100 Index") companies avoided taxation by locating their subsidiaries in tax havens. This increased to 98% when using the stricter US Congress definition of tax haven and [bank secrecy](https://en.wikipedia.org/wiki/Bank_secrecy "Bank secrecy") jurisdictions.[\[31\]](https://en.wikipedia.org/wiki/Tax_avoidance#cite_note-31) In 2016, it was reported in the *[Private Eye](https://en.wikipedia.org/wiki/Private_Eye "Private Eye")* current affairs magazine that four out of the FTSE top 10 companies paid no corporation tax at all.[\[32\]](https://en.wikipedia.org/wiki/Tax_avoidance#cite_note-PEye24/1/16-32)
Tax avoidance by corporations came to national attention in 2012, when MPs singled out [Google](https://en.wikipedia.org/wiki/Google "Google"), [Amazon.com](https://en.wikipedia.org/wiki/Amazon.com "Amazon.com") and [Starbucks](https://en.wikipedia.org/wiki/Starbucks "Starbucks") for criticism.[\[33\]](https://en.wikipedia.org/wiki/Tax_avoidance#cite_note-33) Following accusations that the three companies were diverting hundreds of millions of pounds in UK profits to secretive tax havens, there was widespread outrage across the UK, followed by boycotts of products by Google, Amazon.com and Starbucks.[\[34\]](https://en.wikipedia.org/wiki/Tax_avoidance#cite_note-34)[\[35\]](https://en.wikipedia.org/wiki/Tax_avoidance#cite_note-35) Following the boycotts and damage to brand image, Starbucks promised to move its tax base from the Netherlands to London and to pay [HMRC](https://en.wikipedia.org/wiki/HMRC "HMRC") £20million,[\[36\]](https://en.wikipedia.org/wiki/Tax_avoidance#cite_note-36) but executives from Amazon.com and Google defended their tax avoidance as being within the law.
[Google has remained the subject of criticism](https://en.wikipedia.org/wiki/Criticism_of_Google#Tax_avoidance "Criticism of Google") in the UK regarding their use of the '[Double Irish](https://en.wikipedia.org/wiki/Double_Irish_arrangement "Double Irish arrangement")', [Dutch Sandwich](https://en.wikipedia.org/wiki/Dutch_Sandwich_\(tax_avoidance\) "Dutch Sandwich (tax avoidance)") and [Bermuda Black Hole](https://en.wikipedia.org/wiki/Bermuda_Black_Hole_\(tax_avoidance\) "Bermuda Black Hole (tax avoidance)") tax avoidance schemes.[\[37\]](https://en.wikipedia.org/wiki/Tax_avoidance#cite_note-37) Similarly, Amazon remains the subject of criticism across the UK and [EU](https://en.wikipedia.org/wiki/EU "EU") for its tax avoidance. In October 2017, the EU ordered Amazon to repay €250 million in illegal state aid to Luxembourg following a 'sweetheart deal' between Luxembourg and Amazon.com enabling the American company to artificially reduce its tax bill.[\[38\]](https://en.wikipedia.org/wiki/Tax_avoidance#cite_note-38) [PayPal](https://en.wikipedia.org/wiki/PayPal "PayPal"), [EBay](https://en.wikipedia.org/wiki/EBay "EBay"), [Microsoft](https://en.wikipedia.org/wiki/Microsoft "Microsoft"), [Twitter](https://en.wikipedia.org/wiki/Twitter "Twitter") and [Facebook](https://en.wikipedia.org/wiki/Facebook "Facebook") have also been found to be using the [Double Irish](https://en.wikipedia.org/wiki/Double_Irish "Double Irish") and [Dutch Sandwich](https://en.wikipedia.org/wiki/Dutch_Sandwich "Dutch Sandwich") schemes. Up to 1,000 individuals in the same year were also discovered to be using [K2](https://en.wikipedia.org/wiki/K2_\(tax_scheme\) "K2 (tax scheme)") to avoid tax.[\[39\]](https://en.wikipedia.org/wiki/Tax_avoidance#cite_note-39)
Other UK active corporations mentioned in relation to tax avoidance in 2015, particularly the Double Irish, Dutch Sandwich and Bermuda Black Hole:
- Technology: [Apple](https://en.wikipedia.org/wiki/Criticism_of_Apple_Inc. "Criticism of Apple Inc."), [Microsoft](https://en.wikipedia.org/wiki/Microsoft "Microsoft"), [PayPal](https://en.wikipedia.org/wiki/PayPal "PayPal"), [EBay](https://en.wikipedia.org/wiki/EBay "EBay"), [Intel](https://en.wikipedia.org/wiki/Intel "Intel"), [Yahoo\!](https://en.wikipedia.org/wiki/Yahoo! "Yahoo!"), [Facebook](https://en.wikipedia.org/wiki/Meta_Platforms "Meta Platforms"), [Uber](https://en.wikipedia.org/wiki/Uber "Uber"), [Netflix](https://en.wikipedia.org/wiki/Netflix,_Inc. "Netflix, Inc."), [Hewlett-Packard](https://en.wikipedia.org/wiki/Hewlett-Packard "Hewlett-Packard"), [IBM](https://en.wikipedia.org/wiki/IBM "IBM") and [Twitter](https://en.wikipedia.org/wiki/Twitter,_Inc. "Twitter, Inc.")[\[40\]](https://en.wikipedia.org/wiki/Tax_avoidance#cite_note-40)
- Retail: [Boots](https://en.wikipedia.org/wiki/Boots_UK "Boots UK") (who moved their registered office to a Swiss letterbox),[\[41\]](https://en.wikipedia.org/wiki/Tax_avoidance#cite_note-41) [Kellogg's](https://en.wikipedia.org/wiki/Kellogg%27s "Kellogg's"),[\[42\]](https://en.wikipedia.org/wiki/Tax_avoidance#cite_note-42) and [TopShop](https://en.wikipedia.org/wiki/TopShop "TopShop")[\[43\]](https://en.wikipedia.org/wiki/Tax_avoidance#cite_note-43)
- Football clubs: [Manchester United](https://en.wikipedia.org/wiki/Manchester_United "Manchester United"), [Birmingham City](https://en.wikipedia.org/wiki/Birmingham_City "Birmingham City"), [Coventry City](https://en.wikipedia.org/wiki/Coventry_City "Coventry City") and [Cheltenham Town](https://en.wikipedia.org/wiki/Cheltenham_Town "Cheltenham Town").[\[44\]](https://en.wikipedia.org/wiki/Tax_avoidance#cite_note-44)
- News: [Daily Mail](https://en.wikipedia.org/wiki/Daily_Mail "Daily Mail")[\[45\]](https://en.wikipedia.org/wiki/Tax_avoidance#cite_note-45)
Other corporations mentioned in relation to tax avoidance in later years have been [Vodafone](https://en.wikipedia.org/wiki/Vodafone "Vodafone"), [AstraZeneca](https://en.wikipedia.org/wiki/AstraZeneca "AstraZeneca"), [SABMiller](https://en.wikipedia.org/wiki/SABMiller "SABMiller"), [GlaxoSmithKline](https://en.wikipedia.org/wiki/GlaxoSmithKline "GlaxoSmithKline") and [British American Tobacco](https://en.wikipedia.org/wiki/British_American_Tobacco "British American Tobacco").[\[32\]](https://en.wikipedia.org/wiki/Tax_avoidance#cite_note-PEye24/1/16-32)
Tax avoidance has not always related to corporation tax. A number of companies including [Tesco](https://en.wikipedia.org/wiki/Tesco "Tesco"), [Sainsbury's](https://en.wikipedia.org/wiki/Sainsbury%27s "Sainsbury's"), [WH Smith](https://en.wikipedia.org/wiki/WH_Smith "WH Smith"), [Boots](https://en.wikipedia.org/wiki/Boots_UK "Boots UK") and [Marks and Spencer](https://en.wikipedia.org/wiki/Marks_and_Spencer "Marks and Spencer") used a scheme to avoid [VAT](https://en.wikipedia.org/wiki/VAT "VAT") by forcing customers paying by card to unknowingly pay a 2.5% 'card transaction fee', though the total charged to the customer remained the same. Such schemes came to light after [HMRC](https://en.wikipedia.org/wiki/HMRC "HMRC") litigated against [Debenhams](https://en.wikipedia.org/wiki/Debenhams "Debenhams") over the scheme during 2005.[\[46\]](https://en.wikipedia.org/wiki/Tax_avoidance#cite_note-46)
#### Small company tax avoidance
\[[edit](https://en.wikipedia.org/w/index.php?title=Tax_avoidance&action=edit§ion=19 "Edit section: Small company tax avoidance")\]
In the UK, small business tax avoidance has a substantial impact.[\[47\]](https://en.wikipedia.org/wiki/Tax_avoidance#cite_note-47) HMRC’s tax gap analysis of 2025 calculated that small business is responsible for 60% of an annual £47bn tax shortfall in the UK.[\[48\]](https://en.wikipedia.org/wiki/Tax_avoidance#cite_note-48)
#### General anti-avoidance rule
\[[edit](https://en.wikipedia.org/w/index.php?title=Tax_avoidance&action=edit§ion=20 "Edit section: General anti-avoidance rule")\]
Since the late 1990s, [New Labour](https://en.wikipedia.org/wiki/New_Labour "New Labour") consulted on a "general anti-avoidance rule" (GAAR) for taxation, before deciding against the idea. By 2003, public interest in a GAAR surged as evidence of the scale of tax avoidance used by individuals in the [financial](https://en.wikipedia.org/wiki/Financial_sector "Financial sector") and other sectors became apparent, though in its 2004 Budget the Labour Government announced a new "disclosure regime" as an alternative, whereby tax avoidance schemes would be required to be disclosed to the revenue departments.[\[49\]](https://en.wikipedia.org/wiki/Tax_avoidance#cite_note-49)
In December 2010, the new Coalition government commissioned a report which would consider whether there should be a general anti-avoidance rule for the UK, which recommended that the UK should introduce such a rule, which was introduced in 2013. The rule prevents the reduction of tax by legal arrangements, where those arrangements are put in place purely to reduce tax, and would not otherwise be regarded as a reasonable course of action.[\[7\]](https://en.wikipedia.org/wiki/Tax_avoidance#cite_note-UKGAAR-7)
Following the [Panama Papers](https://en.wikipedia.org/wiki/Panama_Papers "Panama Papers") leak in 2016, *[Private Eye](https://en.wikipedia.org/wiki/Private_Eye "Private Eye")*, *[The Guardian](https://en.wikipedia.org/wiki/The_Guardian "The Guardian")* and other British media outlets noted that [Edward Troup](https://en.wikipedia.org/wiki/Edward_Troup_\(solicitor\) "Edward Troup (solicitor)"), who became executive chair of [HM Revenue and Customs](https://en.wikipedia.org/wiki/HM_Revenue_and_Customs "HM Revenue and Customs"), had worked with [Simmons & Simmons](https://en.wikipedia.org/wiki/Simmons_%26_Simmons "Simmons & Simmons") in 2004 representing corporate tax havens and opposed the GAAR in 1998.[\[50\]](https://en.wikipedia.org/wiki/Tax_avoidance#cite_note-50)[\[51\]](https://en.wikipedia.org/wiki/Tax_avoidance#cite_note-51)[\[52\]](https://en.wikipedia.org/wiki/Tax_avoidance#cite_note-52)
#### Public sector appointments
\[[edit](https://en.wikipedia.org/w/index.php?title=Tax_avoidance&action=edit§ion=21 "Edit section: Public sector appointments")\]
In January 2012 a review of the tax arrangements of people engaged on public sector appointments was undertaken, in order to "ascertain the extent of arrangements which could allow public sector appointees to minimise their tax payments" and make recommendations accordingly.[\[53\]](https://en.wikipedia.org/wiki/Tax_avoidance#cite_note-ppn0712-53) The review was published on 23 May 2012, advising that:
- the most senior staff in public sector appointments should be on the payroll, unless there are exceptional temporary circumstances;
- through their contracting, departments must be able to seek formal assurance from contractors with off payroll arrangements lasting more than six months and costing over £220 per day that income tax and national insurance obligations were being met. Departments were advised to terminate a contract if that assurance was not provided;
- implementation would be monitored carefully with financial sanctions for departments which did not comply.[\[53\]](https://en.wikipedia.org/wiki/Tax_avoidance#cite_note-ppn0712-53)
#### Historical tax avoidance
\[[edit](https://en.wikipedia.org/w/index.php?title=Tax_avoidance&action=edit§ion=22 "Edit section: Historical tax avoidance")\]
##### Window tax
\[[edit](https://en.wikipedia.org/w/index.php?title=Tax_avoidance&action=edit§ion=23 "Edit section: Window tax")\]
[](https://en.wikipedia.org/wiki/File:Window_Tax.jpg)
Avoiding the [window tax](https://en.wikipedia.org/wiki/Window_tax "Window tax") in England
One historic example of tax avoidance still evident today was the payment of [window tax](https://en.wikipedia.org/wiki/Window_tax "Window tax"). It was introduced in [England and Wales](https://en.wikipedia.org/wiki/England_and_Wales "England and Wales") in 1696 with the aim of imposing tax on the relative prosperity of individuals without the controversy of introducing an [income tax](https://en.wikipedia.org/wiki/Income_tax "Income tax").[\[54\]](https://en.wikipedia.org/wiki/Tax_avoidance#cite_note-54) The bigger the house, the more windows it was likely to have, and the more tax the occupants would pay. Nevertheless, the tax was unpopular, because it was seen by some as a "tax on light" (allegedly leading to the phrase daylight robbery) and led property owners to block up windows to avoid it.[\[55\]](https://en.wikipedia.org/wiki/Tax_avoidance#cite_note-55) The tax was repealed in 1851.[\[56\]](https://en.wikipedia.org/wiki/Tax_avoidance#cite_note-56)
##### Deliberate roof destruction
\[[edit](https://en.wikipedia.org/w/index.php?title=Tax_avoidance&action=edit§ion=24 "Edit section: Deliberate roof destruction")\]
Other historic examples of tax avoidance were the [deliberate destructions](https://en.wikipedia.org/wiki/Ruins#Deliberate_destruction "Ruins") of roofs in Scotland to avoid substantial [property taxes](https://en.wikipedia.org/wiki/Property_tax "Property tax"). The roof of [Slains Castle](https://en.wikipedia.org/wiki/New_Slains_Castle "New Slains Castle") was removed in 1925, and the building has deteriorated since.[\[57\]](https://en.wikipedia.org/wiki/Tax_avoidance#cite_note-57) The owners of [Fetteresso Castle](https://en.wikipedia.org/wiki/Fetteresso_Castle "Fetteresso Castle") (now restored) deliberately destroyed their roof after [World War II](https://en.wikipedia.org/wiki/World_War_II "World War II") in protest at the new taxes.
### United States
\[[edit](https://en.wikipedia.org/w/index.php?title=Tax_avoidance&action=edit§ion=25 "Edit section: United States")\]
See also: [United States as a tax haven](https://en.wikipedia.org/wiki/United_States_as_a_tax_haven "United States as a tax haven")
The term tax avoidance indicates a situation in which a taxpayer legally minimizes the amount of his income tax owed. This circumstance occurs by declaring as many deductions and credits as permitted or prioritizing investments with tax advantages.[\[58\]](https://en.wikipedia.org/wiki/Tax_avoidance#cite_note-58)
An IRS report indicates that, in 2009, 1,470 individuals earning more than \$1,000,000 annually faced a net tax liability of zero or less.[\[59\]](https://en.wikipedia.org/wiki/Tax_avoidance#cite_note-59) Also, in 1998 alone, a total of 94 corporations faced a net liability of less than half the full 35% corporate tax rate and the corporations [Lyondell Chemical](https://en.wikipedia.org/wiki/Lyondell_Chemical "Lyondell Chemical"), [Texaco](https://en.wikipedia.org/wiki/Texaco "Texaco"), [Chevron](https://en.wikipedia.org/wiki/Chevron_Corporation "Chevron Corporation"), [CSX](https://en.wikipedia.org/wiki/CSX "CSX"), [Tosco](https://en.wikipedia.org/wiki/Tosco_Corporation "Tosco Corporation"), [PepsiCo](https://en.wikipedia.org/wiki/PepsiCo "PepsiCo"), [Owens & Minor](https://en.wikipedia.org/wiki/Owens_%26_Minor "Owens & Minor"), [Pfizer](https://en.wikipedia.org/wiki/Pfizer "Pfizer"), [JP Morgan](https://en.wikipedia.org/wiki/J.P._Morgan_%26_Co. "J.P. Morgan & Co."), [Saks](https://en.wikipedia.org/wiki/Saks_Incorporated "Saks Incorporated"), [Goodyear](https://en.wikipedia.org/wiki/Goodyear_Tire_and_Rubber_Company "Goodyear Tire and Rubber Company"), [Ryder](https://en.wikipedia.org/wiki/Ryder "Ryder"), [Enron](https://en.wikipedia.org/wiki/Enron "Enron"), [Colgate-Palmolive](https://en.wikipedia.org/wiki/Colgate-Palmolive "Colgate-Palmolive"), [Worldcom](https://en.wikipedia.org/wiki/Worldcom "Worldcom"), [Eaton](https://en.wikipedia.org/wiki/Eaton_Corporation "Eaton Corporation"), [Weyerhaeuser](https://en.wikipedia.org/wiki/Weyerhaeuser "Weyerhaeuser"), [General Motors](https://en.wikipedia.org/wiki/General_Motors "General Motors"), [El Paso Energy](https://en.wikipedia.org/wiki/El_Paso_Energy "El Paso Energy"), Westpoint Stevens, [MedPartners](https://en.wikipedia.org/wiki/MedPartners "MedPartners"), [Phillips Petroleum](https://en.wikipedia.org/wiki/Phillips_Petroleum "Phillips Petroleum"), [McKesson](https://en.wikipedia.org/wiki/McKesson_Corporation "McKesson Corporation") and [Northrop Grumman](https://en.wikipedia.org/wiki/Northrop_Grumman "Northrop Grumman") all had net negative tax liabilities.[\[60\]](https://en.wikipedia.org/wiki/Tax_avoidance#cite_note-60) Additionally, this phenomenon was widely documented regarding [General Electric](https://en.wikipedia.org/wiki/General_Electric "General Electric") in early 2011.[\[61\]](https://en.wikipedia.org/wiki/Tax_avoidance#cite_note-61)
Furthermore, a [Government Accountability Office](https://en.wikipedia.org/wiki/Government_Accountability_Office "Government Accountability Office") study found that, from 1998 to 2005, 55 percent of United States companies paid no federal income taxes during at least one year in a seven-year period it studied.[\[62\]](https://en.wikipedia.org/wiki/Tax_avoidance#cite_note-62)[\[63\]](https://en.wikipedia.org/wiki/Tax_avoidance#cite_note-63) A review in 2011 by [Citizens for Tax Justice](https://en.wikipedia.org/wiki/Citizens_for_Tax_Justice "Citizens for Tax Justice") and the [Institute on Taxation and Economic Policy](https://en.wikipedia.org/wiki/Institute_on_Taxation_and_Economic_Policy "Institute on Taxation and Economic Policy") of companies in the Fortune 500 profitable every year from 2008 through 2010 stated these companies paid an average tax rate of 18.5% and that 30 of these companies actually had a [negative income tax](https://en.wikipedia.org/wiki/Negative_income_tax "Negative income tax") due.[\[64\]](https://en.wikipedia.org/wiki/Tax_avoidance#cite_note-64)
In 2012, [Hewlett-Packard](https://en.wikipedia.org/wiki/Hewlett-Packard "Hewlett-Packard") lost a lawsuit with the IRS over a "foreign tax credit generator" which was engineered by a division of [AIG](https://en.wikipedia.org/wiki/AIG "AIG").[\[65\]](https://en.wikipedia.org/wiki/Tax_avoidance#cite_note-65) [Al Jazeera](https://en.wikipedia.org/wiki/Al_Jazeera_Arabic "Al Jazeera Arabic") also wrote in 2012 that "Rich individuals and their families have as much as \$32 trillion of hidden financial assets in offshore tax havens, representing up to \$280bn in lost income tax revenues ... John Christensen of the [Tax Justice Network](https://en.wikipedia.org/wiki/Tax_Justice_Network "Tax Justice Network") told Al Jazeera that he was shocked by 'the sheer scale of the figures'. ... 'We're talking about very big, well-known brands – [HSBC](https://en.wikipedia.org/wiki/HSBC "HSBC"), [Citigroup](https://en.wikipedia.org/wiki/Citigroup "Citigroup"), [Bank of America](https://en.wikipedia.org/wiki/Bank_of_America "Bank of America"), [UBS](https://en.wikipedia.org/wiki/UBS "UBS"), [Credit Suisse](https://en.wikipedia.org/wiki/Credit_Suisse "Credit Suisse") ... and they do it knowing fully well that their clients, more often than not, are evading and avoiding taxes.' Much of this activity, Christensen added, was illegal."[\[66\]](https://en.wikipedia.org/wiki/Tax_avoidance#cite_note-66)
As a result of the tax sheltering, the government responded with Treasury Department [Circular 230](https://en.wikipedia.org/wiki/Circular_230 "Circular 230"). In 2010, the [Health Care and Education Reconciliation Act of 2010](https://en.wikipedia.org/wiki/Health_Care_and_Education_Reconciliation_Act_of_2010 "Health Care and Education Reconciliation Act of 2010") codified the "economic substance" rule of *[Gregory v. Helvering](https://en.wikipedia.org/wiki/Gregory_v._Helvering "Gregory v. Helvering")* (1935).[\[67\]](https://en.wikipedia.org/wiki/Tax_avoidance#cite_note-67)
The US [Public Interest Research Group](https://en.wikipedia.org/wiki/Public_Interest_Research_Group "Public Interest Research Group") said in 2014 that the [United States](https://en.wikipedia.org/wiki/United_States "United States") government loses roughly \$184 billion per year due to corporations such as Pfizer, Microsoft and Citigroup using offshore tax havens to avoid paying US taxes. According to PIRG:
- [Pfizer](https://en.wikipedia.org/wiki/Pfizer "Pfizer") paid no US income taxes 2010–2012, despite earning \$43 billion. The corporation received more than \$2 billion in federal tax refunds. In 2013, Pfizer operated 128 subsidiaries in tax havens and had \$69 billion offshore which could not be collected by the [Internal Revenue Service](https://en.wikipedia.org/wiki/Internal_Revenue_Service "Internal Revenue Service") (IRS);
- [Microsoft](https://en.wikipedia.org/wiki/Microsoft "Microsoft") maintains five tax haven subsidiaries and held \$76.4 billion overseas in 2013, thus saving the corporation \$24.4 billion in taxes;
- [Citigroup](https://en.wikipedia.org/wiki/Citigroup "Citigroup") maintained 21 subsidiaries in tax haven countries in 2013, and kept \$43.8 billion in offshore jurisdictions, thus saving the corporation an additional \$11.7 billion in taxes.[\[68\]](https://en.wikipedia.org/wiki/Tax_avoidance#cite_note-U.S._PIRG-68)
According to an analysis by the [Institute on Taxation and Economic Policy](https://en.wikipedia.org/wiki/Institute_on_Taxation_and_Economic_Policy "Institute on Taxation and Economic Policy"), global companies in the US are paying an effective tax rate of about negative 9 percent per annum.[\[69\]](https://en.wikipedia.org/wiki/Tax_avoidance#cite_note-69)
An investigation by [ProPublica](https://en.wikipedia.org/wiki/ProPublica "ProPublica") published in 2021 based on leaked IRS documents revealed techniques by which billionaires accumulated massive wealth while paying lower rates than middle-income people, or no tax, or in some cases getting paid refundable childcare tax credits.[\[70\]](https://en.wikipedia.org/wiki/Tax_avoidance#cite_note-70) These include:
- Instead of a salary taxed at the 37% top rate, accepting stock, which is taxed at the 20% [capital gains](https://en.wikipedia.org/wiki/Capital_gains "Capital gains") rate.
- Avoid paying tax on capital gains with the "[buy, borrow, die](https://en.wikipedia.org/w/index.php?title=Buy,_borrow,_die&action=edit&redlink=1 "Buy, borrow, die (page does not exist)")" technique[\[71\]](https://en.wikipedia.org/wiki/Tax_avoidance#cite_note-71):
- Buy or earn capital assets like stocks and real estate, and then never sell because assets do not count as income until sold.
- Using capital assets as [collateral](https://en.wikipedia.org/wiki/Collateral_\(finance\) "Collateral (finance)") to borrow spending money at interest rates considerably lower than the tax rate; loans are not taxed as income.
- Holding capital assets until after death, when a "[step-up in basis](https://en.wikipedia.org/wiki/Step-up_in_basis "Step-up in basis")" zeroes out the accumulated gains and allows heirs to not pay any capital gains tax.
- Avoid the [estate tax](https://en.wikipedia.org/wiki/Estate_tax "Estate tax") by moving money into [trusts](https://en.wikipedia.org/wiki/Trust_law "Trust law") or charitable foundations before death
- Offset [dividend](https://en.wikipedia.org/wiki/Dividend "Dividend") income with the interest paid on loans, or relying on increasing stock prices instead of a dividend
- Offset income with "paper" losses in business operations
- Offset income with [charitable contributions](https://en.wikipedia.org/wiki/Charitable_contribution "Charitable contribution")
## Public opinion
\[[edit](https://en.wikipedia.org/w/index.php?title=Tax_avoidance&action=edit§ion=26 "Edit section: Public opinion")\]
Tax avoidance may be considered to be the dodging of one's duties to society, or alternatively the right of every citizen to structure one's affairs in a manner allowed by law, to pay no more tax than what is required. Attitudes vary from approval through neutrality to outright hostility. Attitudes may vary depending on the steps taken in the avoidance scheme, or the perceived unfairness of the tax being avoided.[\[72\]](https://en.wikipedia.org/wiki/Tax_avoidance#cite_note-72)
In 2008, the charity [Christian Aid](https://en.wikipedia.org/wiki/Christian_Aid "Christian Aid") published a report, *Death and taxes: the true toll of tax dodging*, which criticised tax exiles and tax avoidance by some of the world's largest companies, linking [tax evasion](https://en.wikipedia.org/wiki/Tax_evasion "Tax evasion") to the deaths of millions of children in developing countries.[\[73\]](https://en.wikipedia.org/wiki/Tax_avoidance#cite_note-73) However the research behind these calculations has been questioned in a 2009 paper prepared for the UK [Department for International Development](https://en.wikipedia.org/wiki/Department_for_International_Development "Department for International Development").[\[74\]](https://en.wikipedia.org/wiki/Tax_avoidance#cite_note-74) According to the *Financial Times* there is a growing trend for charities to prioritise tax avoidance as a key campaigning issue, with policy makers across the world considering changes to make tax avoidance more difficult.[\[75\]](https://en.wikipedia.org/wiki/Tax_avoidance#cite_note-75)
In 2010, tax avoidance became a hot-button issue in the UK. An organisation, [UK Uncut](https://en.wikipedia.org/wiki/UK_Uncut "UK Uncut"), began to encourage people to protest at local high-street shops that were thought to be avoiding tax, such as [Vodafone](https://en.wikipedia.org/wiki/Vodafone "Vodafone"), [Topshop](https://en.wikipedia.org/wiki/Topshop "Topshop") and the [Arcadia Group](https://en.wikipedia.org/wiki/Arcadia_Group "Arcadia Group").[\[76\]](https://en.wikipedia.org/wiki/Tax_avoidance#cite_note-76)
In 2012, during the [Occupy movement](https://en.wikipedia.org/wiki/Occupy_movement "Occupy movement") in the United States, tax avoidance for the 99% was proposed as a protest tool.[\[77\]](https://en.wikipedia.org/wiki/Tax_avoidance#cite_note-77)
[Prem Sikka](https://en.wikipedia.org/wiki/Prem_Sikka "Prem Sikka"), Professor of Accounting at the Essex Business School (University of Essex) and scientific advisor of the [Tax Justice Network](https://en.wikipedia.org/wiki/Tax_Justice_Network "Tax Justice Network") pointed to a discrepancy between the [Corporate Social Responsibility](https://en.wikipedia.org/wiki/Corporate_Social_Responsibility "Corporate Social Responsibility") claims of multinational companies and “their internal dynamics aimed at maximising their profits through things like tax avoidance”. He wrote in an article commenting the Lux Leaks publications: “Big corporations and accountancy firms are engaged in organised hypocrisy.”[\[78\]](https://en.wikipedia.org/wiki/Tax_avoidance#cite_note-78)
Public polling undertaken in the UK in 2025 has found continued high levels of concern around corporate tax avoidance and agreement for regulations to be tightened.[\[79\]](https://en.wikipedia.org/wiki/Tax_avoidance#cite_note-79)
Surveys conducted in 2025 in each of the EU's 27 Member States have found high levels of support for large multinationals contributing toward a global minimum tax in each country in which they operate.[\[80\]](https://en.wikipedia.org/wiki/Tax_avoidance#cite_note-80)
### Fair Tax Mark
\[[edit](https://en.wikipedia.org/w/index.php?title=Tax_avoidance&action=edit§ion=27 "Edit section: Fair Tax Mark")\]
As a response to public opinion regarding tax avoidance, the [Fair Tax Mark](https://en.wikipedia.org/wiki/Fair_Tax_Mark "Fair Tax Mark") was established in the UK during 2014 as an independent certification scheme to identify and recognise companies which pay taxes "in accordance with the spirit of all tax laws" and not to use options, allowances, or reliefs, or undertake specific transactions, "that are contrary to the spirit of the law".[\[81\]](https://en.wikipedia.org/wiki/Tax_avoidance#cite_note-81)[\[82\]](https://en.wikipedia.org/wiki/Tax_avoidance#cite_note-82)
The Mark is operated by a not-for-profit community benefit society, the **Fair Tax Foundation**.
Awardees of this mark in the UK include [The Co-op](https://en.wikipedia.org/wiki/The_Co-operative_Group "The Co-operative Group"),[\[83\]](https://en.wikipedia.org/wiki/Tax_avoidance#cite_note-83) [SSE](https://en.wikipedia.org/wiki/SSE_plc "SSE plc"), [Watches of Switzerland](https://en.wikipedia.org/wiki/Watches_of_Switzerland "Watches of Switzerland"), [Ecology Building Society](https://en.wikipedia.org/wiki/Ecology_Building_Society "Ecology Building Society"), [Lush Cosmetics](https://en.wikipedia.org/wiki/Lush_\(company\) "Lush (company)"), [Richer Sounds](https://en.wikipedia.org/wiki/Richer_Sounds "Richer Sounds"), [Scottish Water](https://en.wikipedia.org/wiki/Scottish_Water "Scottish Water"), [United Utilities](https://en.wikipedia.org/wiki/United_Utilities "United Utilities"), [Marshalls](https://en.wikipedia.org/wiki/Marshalls "Marshalls"), several large regional co-operatives ([East of England](https://en.wikipedia.org/wiki/East_of_England_Co-operative_Society "East of England Co-operative Society"), [Midcounties](https://en.wikipedia.org/wiki/Midcounties_Co-operative "Midcounties Co-operative"), [Scotmid](https://en.wikipedia.org/wiki/Scotmid_Co-operative "Scotmid Co-operative")) and [The Phone Co-op](https://en.wikipedia.org/wiki/The_Phone_Co-op "The Phone Co-op"). Outside of the UK, awardees include [Iberdrola](https://en.wikipedia.org/wiki/Iberdrola "Iberdrola"),[\[84\]](https://en.wikipedia.org/wiki/Tax_avoidance#cite_note-84) [Orsted](https://en.wikipedia.org/wiki/%C3%98rsted_\(company\) "Ørsted (company)")[\[85\]](https://en.wikipedia.org/wiki/Tax_avoidance#cite_note-85) and [Vattenfall](https://en.wikipedia.org/wiki/Vattenfall "Vattenfall").[\[86\]](https://en.wikipedia.org/wiki/Tax_avoidance#cite_note-86)
## Government and judicial response
\[[edit](https://en.wikipedia.org/w/index.php?title=Tax_avoidance&action=edit§ion=28 "Edit section: Government and judicial response")\]
[](https://en.wikipedia.org/wiki/File:Countries_implicated_in_the_Panama_Papers.svg)
Countries with politicians, public officials or close associates implicated in the [Panama Papers](https://en.wikipedia.org/wiki/Panama_Papers "Panama Papers") leak on 15 April 2016
Tax avoidance reduces government revenue, so governments with a stricter anti-avoidance stance seek to prevent tax avoidance or keep it within limits. The obvious way to do this is to frame tax rules so that there is a smaller scope for avoidance. In practice this has not always been achievable and has led to an ongoing battle between governments amending legislation and [tax advisors](https://en.wikipedia.org/wiki/Tax_advisor "Tax advisor") finding new scope/loopholes for tax avoidance in the amended rules.\[*[citation needed](https://en.wikipedia.org/wiki/Wikipedia:Citation_needed "Wikipedia:Citation needed")*\]
To allow prompter response to tax avoidance schemes, the US Tax Disclosure Regulations (2003) require prompter and fuller disclosure than previously required, a tactic which was applied in the UK in 2004.
Some countries such as Canada, Australia, United Kingdom and New Zealand have introduced a statutory **General Anti-Avoidance Rule** (or **General Anti-Abuse Rule**, **GAAR**). Canada also uses [Foreign Accrual Property Income](https://en.wikipedia.org/w/index.php?title=Foreign_Accrual_Property_Income&action=edit&redlink=1 "Foreign Accrual Property Income (page does not exist)") rules to obviate certain types of tax avoidance. In the United Kingdom many provisions of the tax legislation (known as "anti-avoidance" provisions) apply to prevent tax avoidance where the main object (or purpose), or one of the main objects (or purposes), of a transaction is to enable tax advantages to be obtained.
In the United States, the [Internal Revenue Service](https://en.wikipedia.org/wiki/Internal_Revenue_Service "Internal Revenue Service") distinguishes some schemes as "abusive" and therefore illegal. The [Alternative Minimum Tax](https://en.wikipedia.org/wiki/Alternative_Minimum_Tax "Alternative Minimum Tax") was developed to reduce the impact of certain tax avoidance schemes. Furthermore, while tax avoidance is in principle legal, if the IRS in its sole judgment determines that tax avoidance is the 'principal purpose' for an expatriation attempt, 'covered expat' status will be applied to the requester, thereby forcing an expatriation tax on worldwide assets to be paid as a condition of expatriation.[\[87\]](https://en.wikipedia.org/wiki/Tax_avoidance#cite_note-87) The IRS presumes a principal purpose of tax avoidance if a taxpayer requesting expatriation has a net worth of \$622,000 or more, or has had more than \$124,000 in average annual net income tax over the 5 tax years ending before the date of expatriation.
### United Kingdom
\[[edit](https://en.wikipedia.org/w/index.php?title=Tax_avoidance&action=edit§ion=29 "Edit section: United Kingdom")\]
See also: [Panama Papers § United Kingdom](https://en.wikipedia.org/wiki/Panama_Papers#United_Kingdom "Panama Papers")
In the UK, judicial doctrines to prevent tax avoidance began in *[IRC v Ramsay](https://en.wikipedia.org/wiki/The_Ramsay_Principle "The Ramsay Principle")* (1981) which decided that where a transaction has pre-arranged artificial steps that serve no commercial purpose other than to save tax, the proper approach is to tax the effect of the transaction as a whole. This is known as the Ramsay principle and this case was followed by *[Furniss v. Dawson](https://en.wikipedia.org/wiki/Furniss_v._Dawson "Furniss v. Dawson")* (1984) which extended the Ramsay principle. This approach has been rejected in most Commonwealth jurisdictions even in those where UK cases are generally regarded as persuasive. After two decades, there have been numerous decisions, with inconsistent approaches, and both the Revenue authorities and professional advisors remain quite unable to predict outcomes. For this reason this approach can be seen as a failure or at best only partly successful.
In the judiciary, different judges have taken different attitudes. As a generalisation, for example, judges in the United Kingdom before the 1970s regarded tax avoidance with neutrality; but nowadays they may regard aggressive tax avoidance with increasing hostility.
In the UK in 2004, the Labour government announced that it would use retrospective legislation to counteract some tax avoidance schemes, and it has subsequently done so on a few occasions, notably [BN66](https://en.wikipedia.org/wiki/BN66 "BN66"). Initiatives announced in 2010 suggest an increasing willingness on the part of HMRC to use retrospective action to counter avoidance schemes, even when no warning has been given.[\[88\]](https://en.wikipedia.org/wiki/Tax_avoidance#cite_note-88)
The UK Government has pushed the initiative led by the [Organisation for Economic Co-operation and Development](https://en.wikipedia.org/wiki/Organisation_for_Economic_Co-operation_and_Development "Organisation for Economic Co-operation and Development") (OECD) on base erosion and profit shifting.[\[89\]](https://en.wikipedia.org/wiki/Tax_avoidance#cite_note-89) In the 2015 Autumn Statement, Chancellor [George Osborne](https://en.wikipedia.org/wiki/George_Osborne "George Osborne") announced that £800m would be spent on tackling tax avoidance in order to recover £5 billion a year by 2019–20. In addition, large companies will now have to publish their UK tax strategies and any large businesses that persistently engage in aggressive tax planning will be subject to special measures.[\[90\]](https://en.wikipedia.org/wiki/Tax_avoidance#cite_note-90) With these policies, Osborne has claimed to be at the forefront of combating tax avoidance.[\[91\]](https://en.wikipedia.org/wiki/Tax_avoidance#cite_note-91) However, he has been criticised over his perceived inaction on enacting policies set forth by the OECD to combat tax avoidance.[\[32\]](https://en.wikipedia.org/wiki/Tax_avoidance#cite_note-PEye24/1/16-32)
In April 2015, the Chancellor George Osborne announced a tax on diverted profits, quickly nicknamed the "Google Tax" by the press, designed to discourage large companies moving profits out of the UK to avoid tax.[\[92\]](https://en.wikipedia.org/wiki/Tax_avoidance#cite_note-92) In 2016, Google agreed to pay back £130m of tax dating back to 2005 to HMRC, which said it was the "full tax due in law".[\[93\]](https://en.wikipedia.org/wiki/Tax_avoidance#cite_note-BBC_Google_Tax_2016-93) However, this amount of tax has been criticised by [Labour](https://en.wikipedia.org/wiki/Labour_Party_\(UK\) "Labour Party (UK)"), with ex Labour leader [Jeremy Corbyn](https://en.wikipedia.org/wiki/Jeremy_Corbyn "Jeremy Corbyn") saying that the rate of tax paid by Google only amounted to 3%.[\[93\]](https://en.wikipedia.org/wiki/Tax_avoidance#cite_note-BBC_Google_Tax_2016-93) Former [Liberal Democrat](https://en.wikipedia.org/wiki/Liberal_Democrats_\(UK\) "Liberal Democrats (UK)") Business Secretary [Vince Cable](https://en.wikipedia.org/wiki/Vince_Cable "Vince Cable") also said Google had "got off very, very lightly", and Osborne "made a fool of himself" by hailing the deal as a victory.[\[93\]](https://en.wikipedia.org/wiki/Tax_avoidance#cite_note-BBC_Google_Tax_2016-93) Although claiming that it was "absurd" to lay blame onto Google for tax avoidance, saying that [EU member states](https://en.wikipedia.org/wiki/EU_member_states "EU member states") should "\[compete\] with each other to offer firms the lowest corporate tax rates", Conservative MP [Boris Johnson](https://en.wikipedia.org/wiki/Boris_Johnson "Boris Johnson") said it was a "good thing" for corporations to pay more tax.[\[94\]](https://en.wikipedia.org/wiki/Tax_avoidance#cite_note-Independent_Johnson_Tax-94) However, Johnson said he did not want tax rates to go up or for European Union countries to do this in unison.[\[94\]](https://en.wikipedia.org/wiki/Tax_avoidance#cite_note-Independent_Johnson_Tax-94)
## See also
\[[edit](https://en.wikipedia.org/w/index.php?title=Tax_avoidance&action=edit§ion=30 "Edit section: See also")\]
- [Estate planning](https://en.wikipedia.org/wiki/Estate_planning "Estate planning")
- [Fair Tax Town](https://en.wikipedia.org/wiki/Fair_Tax_Town "Fair Tax Town") movement
- *[Gregory v. Helvering](https://en.wikipedia.org/wiki/Gregory_v._Helvering "Gregory v. Helvering")*
- [Criticism of Apple Inc.\#Taxes](https://en.wikipedia.org/wiki/Criticism_of_Apple_Inc.#Taxes "Criticism of Apple Inc.")
- [Criticism of Google\#Tax avoidance](https://en.wikipedia.org/wiki/Criticism_of_Google#Tax_avoidance "Criticism of Google")
- [Corruption in Finland\#Tax avoidance](https://en.wikipedia.org/wiki/Corruption_in_Finland#Tax_avoidance "Corruption in Finland")
**General:**
- [Base erosion and profit shifting](https://en.wikipedia.org/wiki/Base_erosion_and_profit_shifting "Base erosion and profit shifting")
- [Capital flight](https://en.wikipedia.org/wiki/Capital_flight "Capital flight")
- [Carried interest](https://en.wikipedia.org/wiki/Carried_interest "Carried interest")
- [Conduit and Sink OFCs](https://en.wikipedia.org/wiki/Conduit_and_Sink_OFCs "Conduit and Sink OFCs")
- [Gaming the system](https://en.wikipedia.org/wiki/Gaming_the_system "Gaming the system")
- [Irish Section 110 SPVs](https://en.wikipedia.org/wiki/Irish_Section_110_Special_Purpose_Vehicle_\(SPV\) "Irish Section 110 Special Purpose Vehicle (SPV)")
- [List of foundations established in Vaduz](https://en.wikipedia.org/wiki/List_of_foundations_established_in_Vaduz "List of foundations established in Vaduz")
- [Tax exemption](https://en.wikipedia.org/wiki/Tax_exemption "Tax exemption")
- [Tax noncompliance](https://en.wikipedia.org/wiki/Tax_noncompliance "Tax noncompliance")
- [Luxembourg Leaks](https://en.wikipedia.org/wiki/Luxembourg_Leaks "Luxembourg Leaks")
- [Singapore Sling (tax avoidance)](https://en.wikipedia.org/wiki/Singapore_Sling_\(tax_avoidance\) "Singapore Sling (tax avoidance)")
- [Swiss Leaks](https://en.wikipedia.org/wiki/Swiss_Leaks "Swiss Leaks")
- [Panama Papers](https://en.wikipedia.org/wiki/Panama_Papers "Panama Papers")
- [Paradise Papers](https://en.wikipedia.org/wiki/Paradise_Papers "Paradise Papers")
## Further reading
\[[edit](https://en.wikipedia.org/w/index.php?title=Tax_avoidance&action=edit§ion=31 "Edit section: Further reading")\]
- [Emmanuel Saez](https://en.wikipedia.org/wiki/Emmanuel_Saez "Emmanuel Saez") and [Gabriel Zucman](https://en.wikipedia.org/wiki/Gabriel_Zucman "Gabriel Zucman"). 2019. *The Triumph of Injustice: How the Rich Dodge Taxes and How to Make Them Pay*. W.W. Norton.
## References
\[[edit](https://en.wikipedia.org/w/index.php?title=Tax_avoidance&action=edit§ion=32 "Edit section: References")\]
1. **[^](https://en.wikipedia.org/wiki/Tax_avoidance#cite_ref-1)**
Dyreng, Scott D.; Hanlon, Michelle; Maydew, Edward L. (2008). "Long-Run Corporate Tax Avoidance". *The Accounting Review*. **83**: 61–82\. [CiteSeerX](https://en.wikipedia.org/wiki/CiteSeerX_\(identifier\) "CiteSeerX (identifier)") [10\.1.1.638.2292](https://citeseerx.ist.psu.edu/viewdoc/summary?doi=10.1.1.638.2292). [doi](https://en.wikipedia.org/wiki/Doi_\(identifier\) "Doi (identifier)"):[10\.2308/accr.2008.83.1.61](https://doi.org/10.2308%2Faccr.2008.83.1.61).
2. **[^](https://en.wikipedia.org/wiki/Tax_avoidance#cite_ref-2)**
Back, Philippa Foster (23 April 2013). ["Avoiding tax may be legal, but can it ever be ethical?"](https://www.theguardian.com/sustainable-business/avoiding-tax-legal-but-ever-ethical). *The Guardian*. [ISSN](https://en.wikipedia.org/wiki/ISSN_\(identifier\) "ISSN (identifier)") [0261-3077](https://search.worldcat.org/issn/0261-3077). Retrieved 17 March 2016.
3. **[^](https://en.wikipedia.org/wiki/Tax_avoidance#cite_ref-3)**
["World Development Report 2019: The Changing Nature of Work"](https://www.worldbank.org/en/publication/wdr2019). *World Bank*. Retrieved 2022-08-02.
4. **[^](https://en.wikipedia.org/wiki/Tax_avoidance#cite_ref-4)** ["MPs publish report on Google's tax avoidance"](http://www.parliament.uk/business/committees/committees-a-z/commons-select/public-accounts-committee/news/tax-avoidance-google/). *UK Parliament*.
5. **[^](https://en.wikipedia.org/wiki/Tax_avoidance#cite_ref-5)** Jesse Drucker (21 October 2010). ["Google 2.4% Rate Shows How \$60 Billion Is Lost to Tax Loopholes"](https://www.bloomberg.com/news/articles/2010-10-21/google-2-4-rate-shows-how-60-billion-u-s-revenue-lost-to-tax-loopholes). *Bloomberg.com*.
6. **[^](https://en.wikipedia.org/wiki/Tax_avoidance#cite_ref-6)** [UK’s general anti-avoidance rule process on schedule](http://tmagazine.ey.com/insights/uks-general-anti-avoidance-rule-process-schedule/). *T Magazine*. [Archived](https://web.archive.org/web/20171020055343/http://www.ey.com/home) 20 October 2017 at the [Wayback Machine](https://en.wikipedia.org/wiki/Wayback_Machine "Wayback Machine")
7. ^ [***a***](https://en.wikipedia.org/wiki/Tax_avoidance#cite_ref-UKGAAR_7-0) [***b***](https://en.wikipedia.org/wiki/Tax_avoidance#cite_ref-UKGAAR_7-1)
["Tax avoidance: general anti-abuse rule guidance - latest version"](https://www.gov.uk/government/publications/tax-avoidance-general-anti-abuse-rules). *GOV.UK*. July 16, 2021.
8. **[^](https://en.wikipedia.org/wiki/Tax_avoidance#cite_ref-8)** For example, a Canadian organization describes Canada's law, first passed in 1988 in Section 245 of the Canada's federal income tax act (described [here](http://www.cra-arc.gc.ca/E/pub/tp/ic88-2/ic88-2-e.html)), as invalidating the tax consequences of a tax avoidance transaction if "not conducted for any primary purpose other than to obtain a tax benefit".
9. **[^](https://en.wikipedia.org/wiki/Tax_avoidance#cite_ref-9)**
["HM Revenue & Customs, Tempted by Tax Avoidance?"](https://www.gov.uk/government/uploads/system/uploads/attachment_data/file/372502/Tempted_by_Tax_Avoidance.pdf) (PDF). *GOV.UK*. Retrieved 6 April 2016.
10. **[^](https://en.wikipedia.org/wiki/Tax_avoidance#cite_ref-NYT01613_10-0)**
David Kocieniewski (6 January 2013). ["Major Companies Push the Limits of a Tax Break"](https://www.nytimes.com/2013/01/07/business/economy/companies-exploit-tax-break-for-asset-exchanges-trial-evidence-shows.html). *The New York Times*. Retrieved 7 January 2013. "With hundreds of thousands of transactions a year, it is hard to gauge the true cost of the tax break for so-called like-kind exchanges, like those used by Cendant, General Electric and Wells Fargo."
11. **[^](https://en.wikipedia.org/wiki/Tax_avoidance#cite_ref-11)**
Stiglitz, Joseph. ["The General Theory of Tax Avoidance"](https://www.nber.org/system/files/working_papers/w1868/w1868.pdf) (PDF). *National Bureau of Economic Research*. Retrieved 21 April 2021.
12. ^ [***a***](https://en.wikipedia.org/wiki/Tax_avoidance#cite_ref-Anti-Avoidance_Measures_12-0) [***b***](https://en.wikipedia.org/wiki/Tax_avoidance#cite_ref-Anti-Avoidance_Measures_12-1)
Ostwal, T.P.; Vijayaraghavan, Vikram (2010). ["Anti-Avoidance Measures"](https://www.jstor.org/stable/44283791). *National Law School of India Review*. **22** (2): 59–103\. [ISSN](https://en.wikipedia.org/wiki/ISSN_\(identifier\) "ISSN (identifier)") [0974-4894](https://search.worldcat.org/issn/0974-4894). [JSTOR](https://en.wikipedia.org/wiki/JSTOR_\(identifier\) "JSTOR (identifier)") [44283791](https://www.jstor.org/stable/44283791).
13. **[^](https://en.wikipedia.org/wiki/Tax_avoidance#cite_ref-13)**
Anonymous (13 September 2016). ["Anti Tax Avoidance Package"](https://ec.europa.eu/taxation_customs/business/company-tax/anti-tax-avoidance-package_en). *Taxation and Customs Union - European Commission*. Retrieved 26 April 2021.
14. **[^](https://en.wikipedia.org/wiki/Tax_avoidance#cite_ref-14)**
PricewaterhouseCoopers. ["ATAD (Anti-Tax Avoidance Directive)"](https://www.pwc.ch/en/services/tax-advice/corporate-taxes-tax-structures/atad.html). *PwC*. Retrieved 22 April 2021.
15. ^ [***a***](https://en.wikipedia.org/wiki/Tax_avoidance#cite_ref-Office_15-0) [***b***](https://en.wikipedia.org/wiki/Tax_avoidance#cite_ref-Office_15-1)
Office, Australian Taxation. ["A strong domestic tax regime"](https://www.ato.gov.au/general/tax-and-corporate-australia/a-strong-domestic-tax-regime/?default). *www.ato.gov.au*. Retrieved 21 April 2021.
16. ^ [***a***](https://en.wikipedia.org/wiki/Tax_avoidance#cite_ref-:0_16-0) [***b***](https://en.wikipedia.org/wiki/Tax_avoidance#cite_ref-:0_16-1)
Stiglitz; Rosengard, Joseph; Jay (2000). *Economics of the Public Sector*. W.W Norton & Company. pp. 709–743\.
`{{cite book}}`: CS1 maint: multiple names: authors list ([link](https://en.wikipedia.org/wiki/Category:CS1_maint:_multiple_names:_authors_list "Category:CS1 maint: multiple names: authors list"))
17. **[^](https://en.wikipedia.org/wiki/Tax_avoidance#cite_ref-17)** Moran Harari, Markus Meinzer and Richard Murphy (October 2012) ["Financial Secrecy, Banks and the Big 4 Firms of Accountants"](http://www.taxjustice.net/cms/upload/pdf/FSI2012_BanksBig4.pdf) [Archived](https://web.archive.org/web/20160407224017/http://www.taxjustice.net/cms/upload/pdf/FSI2012_BanksBig4.pdf) 7 April 2016 at the [Wayback Machine](https://en.wikipedia.org/wiki/Wayback_Machine "Wayback Machine") *Tax Justice Network*
18. **[^](https://en.wikipedia.org/wiki/Tax_avoidance#cite_ref-18)**
["The new refugees. (Americans who give up citizenship to save on taxes)"](https://web.archive.org/web/20060227051231/http://www.frissell.com/taxpat/FORBES1.HTM). *Forbes*. 21 November 1994. Archived from [the original](http://www.frissell.com/taxpat/FORBES1.HTM) on 27 February 2006. Retrieved 23 December 2006.
19. **[^](https://en.wikipedia.org/wiki/Tax_avoidance#cite_ref-19)** "[Foreign Earned Income Exclusion](https://www.irs.gov/individuals/international-taxpayers/foreign-earned-income-exclusion/)", [Internal Revenue Service](https://en.wikipedia.org/wiki/Internal_Revenue_Service "Internal Revenue Service"), [United States Department of the Treasury](https://en.wikipedia.org/wiki/United_States_Department_of_the_Treasury "United States Department of the Treasury").
20. **[^](https://en.wikipedia.org/wiki/Tax_avoidance#cite_ref-20)**
Panozzo, Chantal (18 February 2015). ["When American Expats Don't Want Their Kids to Have U.S. Citizenship"](https://blogs.wsj.com/expat/2015/02/18/when-american-expats-dont-want-their-kids-to-have-u-s-citizenship/). *Wall Street Journal*.
21. **[^](https://en.wikipedia.org/wiki/Tax_avoidance#cite_ref-21)** There are certain well-known exceptions to this: Cyprus has a heavily exploited double taxation relief treaty with Russia; another frequently used treaty is the double taxation relief treaty between Mauritius and India. There are also a number of other less well known and less frequently utilized treaties, such as the one between the British Virgin Islands and Switzerland.
22. **[^](https://en.wikipedia.org/wiki/Tax_avoidance#cite_ref-22)**
["Pasternak M., and Rico C., Tax Interpretation, Planning, and Avoidance: Some Linguistic Analysis, 23 Akron Tax Journal, 33 (2008)"](http://www.uakron.edu/law/lawreview/taxjournal/atj23/docs/Pasternak08.pdf) (PDF).
23. **[^](https://en.wikipedia.org/wiki/Tax_avoidance#cite_ref-23)**
["Fiduciary Trust"](https://www.fiduciarytrust.com/insights/article-detail/how-a-grat-can-help-you-reduce-estate-taxes). *www.fiduciarytrust.com*. Retrieved 2025-06-16.
24. **[^](https://en.wikipedia.org/wiki/Tax_avoidance#cite_ref-24)**
Elton, Edwin; Gruber, Martin (1968). ["The Effect of Share Repurchase on the Value of the Firm"](https://www.jstor.org/stable/2325314). *The Journal of Finance*. **23** (1): 135–149\. [doi](https://en.wikipedia.org/wiki/Doi_\(identifier\) "Doi (identifier)"):[10\.2307/2325314](https://doi.org/10.2307%2F2325314). [ISSN](https://en.wikipedia.org/wiki/ISSN_\(identifier\) "ISSN (identifier)") [0022-1082](https://search.worldcat.org/issn/0022-1082). [JSTOR](https://en.wikipedia.org/wiki/JSTOR_\(identifier\) "JSTOR (identifier)") [2325314](https://www.jstor.org/stable/2325314).
25. ^ [***a***](https://en.wikipedia.org/wiki/Tax_avoidance#cite_ref-:12_25-0) [***b***](https://en.wikipedia.org/wiki/Tax_avoidance#cite_ref-:12_25-1)
Tèrslèv, Thomas; Wier, Ludvig; Zucman, Gabriel (2022). ["The Missing Profits of Nations"](https://doi.org/10.1093/restud/rdac049). *The Review of Economic Studies*. **90** (3): 1499–1534\. [doi](https://en.wikipedia.org/wiki/Doi_\(identifier\) "Doi (identifier)"):[10\.1093/restud/rdac049](https://doi.org/10.1093%2Frestud%2Frdac049). [ISSN](https://en.wikipedia.org/wiki/ISSN_\(identifier\) "ISSN (identifier)") [0034-6527](https://search.worldcat.org/issn/0034-6527).
26. ^ [***a***](https://en.wikipedia.org/wiki/Tax_avoidance#cite_ref-HMRCtaxgap_26-0) [***b***](https://en.wikipedia.org/wiki/Tax_avoidance#cite_ref-HMRCtaxgap_26-1)
["Measuring tax gaps 2018 edition"](https://assets.publishing.service.gov.uk/government/uploads/system/uploads/attachment_data/file/715742/HMRC-measuring-tax-gaps-2018.pdf) (PDF).
27. **[^](https://en.wikipedia.org/wiki/Tax_avoidance#cite_ref-27)**
["New estimates reveal the extent of tax avoidance by multinationals"](http://www.taxjustice.net/2017/03/22/new-estimates-tax-avoidance-multinationals/). 22 March 2017.
28. **[^](https://en.wikipedia.org/wiki/Tax_avoidance#cite_ref-28)**
["TJN Profit Shifting Tax Loss Estimates"](https://docs.google.com/spreadsheets/d/1r7jdXvQ1NaGjUUkH1afniE3xvTyCu7NC8BZWZjkkQ-k/edit?usp=sharing&usp=embed_facebook). *Google Docs*.
29. ^ [***a***](https://en.wikipedia.org/wiki/Tax_avoidance#cite_ref-leigh_29-0) [***b***](https://en.wikipedia.org/wiki/Tax_avoidance#cite_ref-leigh_29-1)
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30. **[^](https://en.wikipedia.org/wiki/Tax_avoidance#cite_ref-30)**
Murphy, Richard. ["Tesco: tax avoiding, again (this time it's Luxembourg)"](https://www.taxresearch.org.uk/Blog/2008/06/11/tesco-tax-avoiding-again-this-time-its-luxembourg/). *Funding the Future*.
31. **[^](https://en.wikipedia.org/wiki/Tax_avoidance#cite_ref-31)**
Lawrence, Felicity (11 October 2011). ["Quarter of FTSE 100 subsidiaries located in tax havens"](https://www.theguardian.com/business/2011/oct/11/ftse-100-subsidiaries-tax-havens?newsfeed=true). *The Guardian*. London.
32. ^ [***a***](https://en.wikipedia.org/wiki/Tax_avoidance#cite_ref-PEye24/1/16_32-0) [***b***](https://en.wikipedia.org/wiki/Tax_avoidance#cite_ref-PEye24/1/16_32-1) [***c***](https://en.wikipedia.org/wiki/Tax_avoidance#cite_ref-PEye24/1/16_32-2)
["Why multinationals love Generous George"](https://web.archive.org/web/20160124020802/http://www.private-eye.co.uk/issue-1410/in-the-back). *Private Eye*. No. 1410. 24 January 2016. Archived from [the original](http://www.private-eye.co.uk/in-the-back) on 24 January 2016. Retrieved 24 January 2016.
33. **[^](https://en.wikipedia.org/wiki/Tax_avoidance#cite_ref-33)** Rajeev Syal. ["MPs attack Amazon, Google and Starbucks over tax avoidance"](https://www.theguardian.com/business/2012/dec/03/amazon-google-starbucks-tax-avoidance). *The Guardian*.
34. **[^](https://en.wikipedia.org/wiki/Tax_avoidance#cite_ref-34)** Rajeev Syal. ["Amazon, Google and Starbucks accused of diverting UK profits"](https://www.theguardian.com/business/2012/nov/12/amazon-google-starbucks-diverting-uk-profits). *The Guardian*.
35. **[^](https://en.wikipedia.org/wiki/Tax_avoidance#cite_ref-35)** Juliette Garside. ["Amazon UK boycott urged after retailer pays just £4.2m in tax"](https://www.theguardian.com/business/2014/may/09/margaret-hodge-urges-boycott-amazon-uk-tax-starbucks). *The Guardian*.
36. **[^](https://en.wikipedia.org/wiki/Tax_avoidance#cite_ref-36)**
["Starbucks suffers first ever drop in UK sales after tax criticism"](https://www.irishtimes.com/business/retail-and-services/starbucks-suffers-first-ever-drop-in-uk-sales-after-tax-criticism-1.1772574). *Irish Times*. 24 April 2014. Retrieved 8 September 2020.
37. **[^](https://en.wikipedia.org/wiki/Tax_avoidance#cite_ref-37)**
Williams, Christopher (10 December 2014). ["'Google Tax' targets 'double Irish' tax avoidance"](https://www.telegraph.co.uk/finance/autumn-statement/11284781/Google-Tax-targets-double-Irish-tax-avoidance.html). *The Daily Telegraph*. London. [Archived](https://ghostarchive.org/archive/20220112/https://www.telegraph.co.uk/finance/autumn-statement/11284781/Google-Tax-targets-double-Irish-tax-avoidance.html) from the original on 2022-01-12.
38. **[^](https://en.wikipedia.org/wiki/Tax_avoidance#cite_ref-38)**
Rankin, Jennifer (4 October 2017). ["Amazon ordered to repay €250m by EU over 'illegal tax advantages' This article is more than 2 yea"](https://www.theguardian.com/technology/2017/oct/04/amazon-eu-tax-irish-government-apple). *The Guardian*. Retrieved 8 September 2020.
39. **[^](https://en.wikipedia.org/wiki/Tax_avoidance#cite_ref-39)**
Mostrous, Alexi. ["Times investigation: the tax avoiders"](https://www.thetimes.com/article/times-investigation-the-tax-avoiders-0rkt3fhwtrn).
40. **[^](https://en.wikipedia.org/wiki/Tax_avoidance#cite_ref-40)** Simon Bowers. ["US tech giants launch fierce fightback against global tax avoidance crackdown"](https://www.theguardian.com/business/2015/jan/21/us-tech-tax-avoidance-google-amazon-apple). *The Guardian*.
41. **[^](https://en.wikipedia.org/wiki/Tax_avoidance#cite_ref-41)**
["Boris Johnson enters Boots v Labour tax row"](https://www.bbc.co.uk/news/uk-politics-31108896). *BBC News*. 3 February 2015.
42. **[^](https://en.wikipedia.org/wiki/Tax_avoidance#cite_ref-42)**
Paul, Mark (7 April 2015). ["Kellogg's pays €7m tax on €7.1bn sales moved through State"](https://www.irishtimes.com/business/economy/kellogg-s-pays-7m-tax-on-7-1bn-sales-moved-through-state-1.2166810?mode=sample&auth-failed=1&pw-origin=https%3A%2F%2Fwww.irishtimes.com%2Fbusiness%2Feconomy%2Fkellogg-s-pays-7m-tax-on-7-1bn-sales-moved-through-state-1.2166810). *The Irish Times*. Retrieved 8 September 2020.
43. **[^](https://en.wikipedia.org/wiki/Tax_avoidance#cite_ref-43)** [The Emperor's New Clothes (2015 film)](https://en.wikipedia.org/wiki/The_Emperor%27s_New_Clothes_\(2015_film\) "The Emperor's New Clothes (2015 film)")
44. **[^](https://en.wikipedia.org/wiki/Tax_avoidance#cite_ref-44)**
Hyde, Dan (17 February 2015). ["Ferguson faces bill for film 'tax dodge'"](https://www.telegraph.co.uk/news/uknews/11419176/Ferguson-faces-bill-for-film-tax-dodge.html). *The Daily Telegraph*. London. [Archived](https://ghostarchive.org/archive/20220112/https://www.telegraph.co.uk/news/uknews/11419176/Ferguson-faces-bill-for-film-tax-dodge.html) from the original on 2022-01-12.
45. **[^](https://en.wikipedia.org/wiki/Tax_avoidance#cite_ref-45)** David Leigh. ["A who's who of Britain's legal offshore tax avoidance"](https://www.theguardian.com/business/2014/jul/10/whos-who-britain-legal-offshore-tax-avoidance-james-dyson). *The Guardian*.
46. **[^](https://en.wikipedia.org/wiki/Tax_avoidance#cite_ref-46)**
Brooks, Richard (2013). *The Great Tax Robbery*. London: Oneworld. p. 297. [ISBN](https://en.wikipedia.org/wiki/ISBN_\(identifier\) "ISBN (identifier)")
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48. **[^](https://en.wikipedia.org/wiki/Tax_avoidance#cite_ref-48)**
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Steely, Anthony (15 May 2015). ["Tax avoidance: a General Anti-Avoidance Rule - background history (1997- 2010)"](https://web.archive.org/web/20160505135216/http://researchbriefings.files.parliament.uk/documents/SN02956/SN02956.pdf) (PDF). *House of Commons*. No. BRIEFING PAPER Number 02956. House of Commons Library. p. 3. Archived from [the original](http://researchbriefings.files.parliament.uk/documents/SN02956%2FSN02956.pdf) (PDF) on 5 May 2016. Retrieved 20 April 2016.
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51. **[^](https://en.wikipedia.org/wiki/Tax_avoidance#cite_ref-51)**
Booth, Robert (11 April 2016). ["Edward Troup: from tax haven adviser to leading HMRC's Panama inquiry"](https://www.theguardian.com/politics/2016/apr/11/edward-troup-advising-tax-havens-leading-hmrs-panama-papers-inquiry). *The Guardian*. Retrieved 20 April 2016.
52. **[^](https://en.wikipedia.org/wiki/Tax_avoidance#cite_ref-52)**
Sridharan, Vasudevan (11 April 2016). ["Panama Papers: HMRC boss Edward Troup was partner at law firm that represented Ian Cameron's offshore fund"](http://www.ibtimes.co.uk/panama-papers-hmrc-boss-edward-troup-was-partner-law-firm-that-represented-ian-camerons-1554123). *International Business Times UK*. Retrieved 20 April 2016.
53. ^ [***a***](https://en.wikipedia.org/wiki/Tax_avoidance#cite_ref-ppn0712_53-0) [***b***](https://en.wikipedia.org/wiki/Tax_avoidance#cite_ref-ppn0712_53-1) Cabinet Office, [Procurement Policy Note – Tax Arrangements of Public Appointees - Action Note 07/12 24 August 2012](https://assets.publishing.service.gov.uk/government/uploads/system/uploads/attachment_data/file/62099/PPN-0712-Tax-Arrangements-of-Public-Appointees.pdf), accessed 8 February 2021
54. **[^](https://en.wikipedia.org/wiki/Tax_avoidance#cite_ref-54)**
Herber, Mark D (1997). *Ancestral Trails: The complete guide to British genealogy and family history*. Sutton Publishing Ltd. [ISBN](https://en.wikipedia.org/wiki/ISBN_\(identifier\) "ISBN (identifier)")
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60. **[^](https://en.wikipedia.org/wiki/Tax_avoidance#cite_ref-60)**
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61. **[^](https://en.wikipedia.org/wiki/Tax_avoidance#cite_ref-61)** ["G.E.’s Strategies Let It Avoid Taxes Altogether"](https://www.nytimes.com/2011/03/25/business/economy/25tax.html). *The New York Times*. 25 March 2011.
62. **[^](https://en.wikipedia.org/wiki/Tax_avoidance#cite_ref-62)** ["U.S. Business Has High Tax Rates but Pays Less"](https://www.nytimes.com/2011/05/03/business/economy/03rates.html). *The New York Times*. 3 May 2011.
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65. **[^](https://en.wikipedia.org/wiki/Tax_avoidance#cite_ref-65)** [HP Loses Battle with IRS Over Tax Shelter Designed by AIG](http://www.insurancejournal.com/news/national/2012/05/15/247537.htm). *Insurance Journal*.
66. **[^](https://en.wikipedia.org/wiki/Tax_avoidance#cite_ref-66)**
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67. **[^](https://en.wikipedia.org/wiki/Tax_avoidance#cite_ref-67)** Rose CA. [Tax Lawyer’s Dilemma: Recent Developments Heighten Tax Lawyer Responsibilities and Liabilities](http://cblr.columbia.edu/archives/11910) [Archived](https://web.archive.org/web/20121220214854/http://cblr.columbia.edu/archives/11910) 20 December 2012 at the [Wayback Machine](https://en.wikipedia.org/wiki/Wayback_Machine "Wayback Machine"). *Columbia Business Law Review*. Volume 2011, Issue 1.
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69. **[^](https://en.wikipedia.org/wiki/Tax_avoidance#cite_ref-69)** Ingraham, Christopher (5 April 2021) ["Dozens of America’s biggest businesses paid no federal income tax — again"](https://www.washingtonpost.com/business/2021/04/05/corporations-federal-taxes/) *The Washington Post*. Retrieved 30 April 2021.
70. **[^](https://en.wikipedia.org/wiki/Tax_avoidance#cite_ref-70)**
Jesse Eisinger; Jeff Ernsthausen; Paul Kiel (8 June 2021). ["The Secret IRS Files: Trove of Never-Before-Seen Records Reveal How the Wealthiest Avoid Income Tax"](https://www.propublica.org/article/the-secret-irs-files-trove-of-never-before-seen-records-reveal-how-the-wealthiest-avoid-income-tax).
71. **[^](https://en.wikipedia.org/wiki/Tax_avoidance#cite_ref-71)**
Karma, Rogé (2025-03-17). ["Buy, Borrow, Die"](https://www.theatlantic.com/economy/archive/2025/03/tax-loophole-buy-borrow-die/682031/). *The Atlantic*. Retrieved 2025-11-21.
72. **[^](https://en.wikipedia.org/wiki/Tax_avoidance#cite_ref-72)**
["Jimmy Carr and the morality of tax avoidance"](https://www.bbc.co.uk/news/magazine-18537051). *BBC News*. 21 June 2012.
73. **[^](https://en.wikipedia.org/wiki/Tax_avoidance#cite_ref-73)**
O'grady, Sean (12 May 2008). ["Tax evasion 'costs lives of 5.6m children'"](https://web.archive.org/web/20080517055221/http://www.independent.co.uk/news/uk/home-news/tax-evasion-costs-lives-of-56m-children-826252.html). *The Independent*. London. Archived from [the original](https://www.independent.co.uk/news/uk/home-news/tax-evasion-costs-lives-of-56m-children-826252.html) on 17 May 2008.
74. **[^](https://en.wikipedia.org/wiki/Tax_avoidance#cite_ref-74)**
Fuest, Clemens; Riedel, Nadine (19 June 2009). ["Tax evasion, tax avoidance and tax expenditures in developing countries: A review of the literature"](https://web.archive.org/web/20120113001447/http://www.sbs.ox.ac.uk/centres/tax/Documents/reports/TaxEvasionReportDFIDFINAL1906.pdf) (PDF). Oxford: Oxford University Centre for Business Taxation. Archived from [the original](http://www.sbs.ox.ac.uk/centres/tax/Documents/reports/TaxEvasionReportDFIDFINAL1906.pdf) (PDF) on 13 January 2012. Retrieved 21 October 2011.
`{{cite journal}}`: Cite journal requires `|journal=` ([help](https://en.wikipedia.org/wiki/Help:CS1_errors#missing_periodical "Help:CS1 errors"))
75. **[^](https://en.wikipedia.org/wiki/Tax_avoidance#cite_ref-75)**
Vanessa Houlder (8 November 2010). ["Tax claims hit reputation as well as coffers"](https://www.ft.com/content/c153e27c-eb7d-11df-b482-00144feab49a). *[Financial Times](https://en.wikipedia.org/wiki/Financial_Times "Financial Times")*. [Archived](https://ghostarchive.org/archive/20221210221229/https://www.ft.com/content/c153e27c-eb7d-11df-b482-00144feab49a#axzz14mgsdfEK) from the original on 10 December 2022. Retrieved 9 November 2010.
76. **[^](https://en.wikipedia.org/wiki/Tax_avoidance#cite_ref-76)**
Lewis, Paul; Taylor, Matthew; Gabbatt, Adam; Jeffery, Simon (3 December 2010). ["UK Uncut protesters spied upon by undercover police"](https://www.theguardian.com/uk/2010/dec/03/uk-uncut-protests-undercover-police). *The Guardian*. London. Retrieved 30 December 2010.
77. **[^](https://en.wikipedia.org/wiki/Tax_avoidance#cite_ref-77)**
Cohn, Emily (6 April 2012). ["TaxKilla: Tax Strategy For The 99 Percent, Taken From The 1 Percent"](http://www.huffingtonpost.com/2012/04/05/taxes-taxkilla-99-percent_n_1405756.html). *Huffington Post*. Retrieved 22 September 2012.
78. **[^](https://en.wikipedia.org/wiki/Tax_avoidance#cite_ref-78)** [The conversation](https://en.wikipedia.org/wiki/The_Conversation_\(website\) "The Conversation (website)"), [Luxembourg leaks reveal the organised hypocrisy of the modern corporation](https://theconversation.com/columns/prem-sikka-4302), 10 November 2014
79. **[^](https://en.wikipedia.org/wiki/Tax_avoidance#cite_ref-79)**
Monaghan, Paul (2025-09-13). ["UK public call on Government to take firmer action to ensure business makes a fair tax contribution"](https://fairtaxmark.net/uk-public-call-on-government-to-take-firmer-action-to-ensure-business-makes-a-fair-tax-contribution/). *Fair Tax Foundation*. Retrieved 2025-10-27.
80. **[^](https://en.wikipedia.org/wiki/Tax_avoidance#cite_ref-80)**
["Eurobarometer"](https://europa.eu/eurobarometer/surveys/detail/3375). *europa.eu*. Retrieved 2025-10-27.
81. **[^](https://en.wikipedia.org/wiki/Tax_avoidance#cite_ref-81)**
["Why get the Fair Tax Mark?"](https://fairtaxmark.net/why-get-the-fair-tax-mark/). *Fair Tax Foundation*. Retrieved 2025-05-16.
82. **[^](https://en.wikipedia.org/wiki/Tax_avoidance#cite_ref-82)**
Scott, Craig (20 February 2014). ["Fair Tax Mark to reward tax justice"](https://www.theguardian.com/sustainable-business/fair-tax-mark-to-reward-tax-justice). *The Guardian*.
83. **[^](https://en.wikipedia.org/wiki/Tax_avoidance#cite_ref-83)**
["Open about tax"](http://www.co-operative.coop/corporate/investors/tax-policy/).
84. **[^](https://en.wikipedia.org/wiki/Tax_avoidance#cite_ref-84)**
Press, Europa (2024-10-17). ["Iberdrola, única empresa española en obtener el certificado 'Fair Tax' internacional"](https://www.europapress.es/economia/energia-medio-ambiente-00183/noticia-iberdrola-unica-empresa-espanola-obtener-certificado-fair-tax-internacional-20241017102923.html). *www.europapress.es*. Retrieved 2025-10-27.
85. **[^](https://en.wikipedia.org/wiki/Tax_avoidance#cite_ref-85)**
Frederiksen, Claus Strue (2023-11-21). ["Fair Tax Foundation: Ørsted eneste med skatte-certifikat, men flere på vej"](https://ugebrev.dk/samfundsansvar/esg-nyt/fair-tax-foundation-oersted-eneste-med-skatte-certifikat-men-flere-paa-vej/). *Økonomisk Ugebrev* (in Danish). Retrieved 2025-10-27.
86. **[^](https://en.wikipedia.org/wiki/Tax_avoidance#cite_ref-86)**
Jones, Alice (2021-11-25). ["Fair Tax Mark goes global with new standard"](https://www.internationaltaxreview.com/article/2a68rfy5bw2ycq1zyexsr/fair-tax-mark-goes-global-with-new-standard). *ITR*. Retrieved 2025-10-27.
87. **[^](https://en.wikipedia.org/wiki/Tax_avoidance#cite_ref-87)**
["Expatriation Tax \| Internal Revenue Service"](https://web.archive.org/web/20170207005537/https://www.irs.gov/individuals/international-taxpayers/expatriation-tax). *www.irs.gov*. Archived from [the original](https://www.irs.gov/individuals/international-taxpayers/expatriation-tax) on 7 February 2017.
88. **[^](https://en.wikipedia.org/wiki/Tax_avoidance#cite_ref-88)** [HMRC goes on £1bn retro warpath](http://www.accountancyage.com/accountancyage/news/2258065/hmrc-goes-1bn-retro-warpath) [Archived](https://web.archive.org/web/20100221181537/http://www.accountancyage.com/accountancyage/news/2258065/hmrc-goes-1bn-retro-warpath) 21 February 2010 at the [Wayback Machine](https://en.wikipedia.org/wiki/Wayback_Machine "Wayback Machine"), *[Accountancy Age](https://en.wikipedia.org/wiki/Accountancy_Age "Accountancy Age")*, 18 February 2010
89. **[^](https://en.wikipedia.org/wiki/Tax_avoidance#cite_ref-89)**
["2013: Has the Chancellor Delivered a Budget for Business? - CFO Insight"](https://web.archive.org/web/20131105040152/http://www.cfo-insight.com/reporting-forecasting/tax/2013-has-the-chancellor-delivered-a-budget-for-business/). *www.cfo-insight.com*. Archived from [the original](http://www.cfo-insight.com/reporting-forecasting/tax/2013-has-the-chancellor-delivered-a-budget-for-business/) on 5 November 2013.
90. **[^](https://en.wikipedia.org/wiki/Tax_avoidance#cite_ref-90)**
["Autumn Statement 2015: Changes to bring in £5bn a year from tax avoidance"](https://www.cityam.com/autumn-statement-2015-tax-changes-to-bring-in-5bn-a-year-from-avoidance/). *CityAM*. November 25, 2015.
91. **[^](https://en.wikipedia.org/wiki/Tax_avoidance#cite_ref-91)**
Szu Ping Chan (9 October 2015). ["Taxes must be paid, says George Osborne, as he backs crackdown on havens"](https://www.telegraph.co.uk/finance/economics/11923216/Taxes-must-be-paid-says-George-Osborne-as-he-unveils-crackdown-on-havens.html). *The Daily Telegraph*. Lima. [Archived](https://ghostarchive.org/archive/20220112/https://www.telegraph.co.uk/finance/economics/11923216/Taxes-must-be-paid-says-George-Osborne-as-he-unveils-crackdown-on-havens.html) from the original on 2022-01-12. Retrieved 24 January 2016. "George Osborne has warned that companies which dodge tax will face the full force of the law, as he pledged to implement new rules designed to close international loopholes and end tax havens."
92. **[^](https://en.wikipedia.org/wiki/Tax_avoidance#cite_ref-92)**
["Budget 2015: 'Google Tax' introduction confirmed"](https://www.bbc.co.uk/news/business-31942639). *BBC News*. 18 March 2015.
93. ^ [***a***](https://en.wikipedia.org/wiki/Tax_avoidance#cite_ref-BBC_Google_Tax_2016_93-0) [***b***](https://en.wikipedia.org/wiki/Tax_avoidance#cite_ref-BBC_Google_Tax_2016_93-1) [***c***](https://en.wikipedia.org/wiki/Tax_avoidance#cite_ref-BBC_Google_Tax_2016_93-2)
["Google tax: David Cameron defends £130m UK tax deal"](https://www.bbc.co.uk/news/business-35416812). *BBC News*. 27 January 2016. Retrieved 27 January 2016.
94. ^ [***a***](https://en.wikipedia.org/wiki/Tax_avoidance#cite_ref-Independent_Johnson_Tax_94-0) [***b***](https://en.wikipedia.org/wiki/Tax_avoidance#cite_ref-Independent_Johnson_Tax_94-1)
Stone, Jon (26 January 2016). ["It is 'absurd' to blame Google for not paying their taxes, Boris Johnson says"](https://www.independent.co.uk/news/uk/politics/it-is-absurd-to-blame-google-for-not-paying-their-taxes-boris-johnson-says-a6832361.html). *The Independent*. [Archived](https://ghostarchive.org/archive/20220526/https://www.independent.co.uk/news/uk/politics/it-is-absurd-to-blame-google-for-not-paying-their-taxes-boris-johnson-says-a6832361.html) from the original on 2022-05-26. Retrieved 27 January 2016.
## External links
\[[edit](https://en.wikipedia.org/w/index.php?title=Tax_avoidance&action=edit§ion=33 "Edit section: External links")\]
- [Tax Avoidance](https://www.theguardian.com/business/taxavoidance) collected news and commentary at *[The Guardian](https://en.wikipedia.org/wiki/The_Guardian "The Guardian")* [](https://www.wikidata.org/wiki/Q329303#P3106 "Edit this at Wikidata")
- [Fact File: Tax Avoidance](https://www.independent.co.uk/news/factfiles/fact-file-tax-avoidance-7873011.html), *[The Independent](https://en.wikipedia.org/wiki/The_Independent "The Independent")*
| [v](https://en.wikipedia.org/wiki/Template:Tax_resistance "Template:Tax resistance") [t](https://en.wikipedia.org/wiki/Template_talk:Tax_resistance "Template talk:Tax resistance") [e](https://en.wikipedia.org/wiki/Special:EditPage/Template:Tax_resistance "Special:EditPage/Template:Tax resistance")[Tax resistance](https://en.wikipedia.org/wiki/Tax_resistance "Tax resistance") | |
|---|---|
| Topics | [Conscientious objection to military taxation](https://en.wikipedia.org/wiki/Conscientious_objection_to_military_taxation "Conscientious objection to military taxation") [List of historical acts of tax resistance](https://en.wikipedia.org/wiki/List_of_historical_acts_of_tax_resistance "List of historical acts of tax resistance") [Tax resistance in the United States](https://en.wikipedia.org/wiki/Tax_resistance_in_the_United_States "Tax resistance in the United States") . [List of tax resisters](https://en.wikipedia.org/wiki/Category:Tax_resisters "Category:Tax resisters") |
| Methods | [Barter](https://en.wikipedia.org/wiki/Barter "Barter") [Gift economy](https://en.wikipedia.org/wiki/Gift_economy "Gift economy") [Local currency](https://en.wikipedia.org/wiki/Local_currency "Local currency") [Rebellion](https://en.wikipedia.org/wiki/Rebellion "Rebellion") [Self-sufficiency](https://en.wikipedia.org/wiki/Self-sufficiency "Self-sufficiency") [Simple living](https://en.wikipedia.org/wiki/Simple_living "Simple living") [Tax avoidance]() [Tax evasion](https://en.wikipedia.org/wiki/Tax_evasion "Tax evasion") [Unreported employment](https://en.wikipedia.org/wiki/Unreported_employment "Unreported employment") |
| Organizations | [Addiopizzo](https://en.wikipedia.org/wiki/Addiopizzo "Addiopizzo") [Aide-toi, le ciel t'aidera](https://en.wikipedia.org/wiki/Aide-toi,_le_ciel_t%27aidera "Aide-toi, le ciel t'aidera") [All Britain Anti-Poll Tax Federation](https://en.wikipedia.org/wiki/All_Britain_Anti-Poll_Tax_Federation "All Britain Anti-Poll Tax Federation") [Anti-Poll Tax Unions](https://en.wikipedia.org/wiki/Anti-Poll_Tax_Unions "Anti-Poll Tax Unions") [Association of Real Estate Taxpayers](https://en.wikipedia.org/wiki/Association_of_Real_Estate_Taxpayers "Association of Real Estate Taxpayers") [Catalunya Diu Prou](https://en.wikipedia.org/wiki/Catalunya_Diu_Prou "Catalunya Diu Prou") [Committee for Non-Violent Action](https://en.wikipedia.org/wiki/Committee_for_Non-Violent_Action "Committee for Non-Violent Action") [Fasci Siciliani](https://en.wikipedia.org/wiki/Fasci_Siciliani "Fasci Siciliani") [I Don't Pay Movement](https://en.wikipedia.org/wiki/I_Don%27t_Pay_Movement "I Don't Pay Movement") [Irish National Land League](https://en.wikipedia.org/wiki/Irish_National_Land_League "Irish National Land League") [National Campaign for a Peace Tax Fund](https://en.wikipedia.org/wiki/National_Campaign_for_a_Peace_Tax_Fund "National Campaign for a Peace Tax Fund") [National War Tax Resistance Coordinating Committee](https://en.wikipedia.org/wiki/National_War_Tax_Resistance_Coordinating_Committee "National War Tax Resistance Coordinating Committee") [Northern California War Tax Resistance](https://en.wikipedia.org/wiki/Northern_California_War_Tax_Resistance "Northern California War Tax Resistance") [Pagal Panthis](https://en.wikipedia.org/wiki/Pagal_Panthis "Pagal Panthis") [Peace churches](https://en.wikipedia.org/wiki/Peace_churches "Peace churches") [Peacemakers](https://en.wikipedia.org/wiki/Peacemakers "Peacemakers") [Planka.nu](https://en.wikipedia.org/wiki/Planka.nu "Planka.nu") [Women's Tax Resistance League](https://en.wikipedia.org/wiki/Women%27s_Tax_Resistance_League "Women's Tax Resistance League") [Zuism](https://en.wikipedia.org/wiki/Zuism "Zuism") |
| Media | *[An Act of Conscience](https://en.wikipedia.org/wiki/An_Act_of_Conscience "An Act of Conscience")* "[Civil Disobedience](https://en.wikipedia.org/wiki/Civil_Disobedience_\(essay\) "Civil Disobedience (essay)")" *[Clericis laicos](https://en.wikipedia.org/wiki/Clericis_laicos "Clericis laicos")* *[The Cold War and the Income Tax: A Protest](https://en.wikipedia.org/wiki/The_Cold_War_and_the_Income_Tax:_A_Protest "The Cold War and the Income Tax: A Protest")* "[Vyborg Manifesto](https://en.wikipedia.org/wiki/Vyborg_Manifesto "Vyborg Manifesto")" |
| Campaigns by century | |
| | |
| 14th | [Tuchin Revolt](https://en.wikipedia.org/wiki/Tuchin_Revolt "Tuchin Revolt") [Harelle](https://en.wikipedia.org/wiki/Harelle "Harelle") [Peasants' Revolt](https://en.wikipedia.org/wiki/Peasants%27_Revolt "Peasants' Revolt") |
| 15th | [Cornish rebellion of 1497](https://en.wikipedia.org/wiki/Cornish_rebellion_of_1497 "Cornish rebellion of 1497") |
| 16th | [Croquant rebellions](https://en.wikipedia.org/wiki/Croquant_rebellions "Croquant rebellions") [Rappenkrieg](https://en.wikipedia.org/wiki/Rappenkrieg_\(Basel\) "Rappenkrieg (Basel)") [Revolt of the Pitauds](https://en.wikipedia.org/wiki/Revolt_of_the_Pitauds "Revolt of the Pitauds") |
| 17th | [Angelets](https://en.wikipedia.org/wiki/Angelets "Angelets") [Revolt of the papier timbré](https://en.wikipedia.org/wiki/Revolt_of_the_papier_timbr%C3%A9 "Revolt of the papier timbré") [Revolt of the va-nu-pieds](https://en.wikipedia.org/wiki/Revolt_of_the_va-nu-pieds "Revolt of the va-nu-pieds") [Salt Tax Revolt](https://en.wikipedia.org/wiki/Salt_Tax_Revolt "Salt Tax Revolt") in Spain [Salt Riot](https://en.wikipedia.org/wiki/Moscow_uprising_of_1648 "Moscow uprising of 1648") in Moscow |
| 18th | [Boston Tea Party](https://en.wikipedia.org/wiki/Boston_Tea_Party "Boston Tea Party") [Edenton Tea Party](https://en.wikipedia.org/wiki/Edenton_Tea_Party "Edenton Tea Party") [Fries's Rebellion](https://en.wikipedia.org/wiki/Fries%27s_Rebellion "Fries's Rebellion") [*Gaspee* affair](https://en.wikipedia.org/wiki/Gaspee_affair "Gaspee affair") [No taxation without representation](https://en.wikipedia.org/wiki/No_taxation_without_representation "No taxation without representation") [Philadelphia Tea Party](https://en.wikipedia.org/wiki/Philadelphia_Tea_Party "Philadelphia Tea Party") [Revolt of the Comuneros (New Granada)](https://en.wikipedia.org/wiki/Revolt_of_the_Comuneros_\(New_Granada\) "Revolt of the Comuneros (New Granada)") [Regulator Movement in North Carolina](https://en.wikipedia.org/wiki/Regulator_Movement_in_North_Carolina "Regulator Movement in North Carolina") [Whiskey Rebellion](https://en.wikipedia.org/wiki/Whiskey_Rebellion "Whiskey Rebellion") [White Lotus Rebellion](https://en.wikipedia.org/wiki/White_Lotus_Rebellion "White Lotus Rebellion") |
| 19th | [Anti-Rent War](https://en.wikipedia.org/wiki/Anti-Rent_War "Anti-Rent War") [Dog Tax War](https://en.wikipedia.org/wiki/Dog_Tax_War "Dog Tax War") [House Tax Hartal](https://en.wikipedia.org/wiki/1810_House_Tax_Hartal "1810 House Tax Hartal") [Hut Tax War of 1898](https://en.wikipedia.org/wiki/Hut_Tax_War_of_1898 "Hut Tax War of 1898") [Low Rebellion](https://en.wikipedia.org/wiki/Low_Rebellion "Low Rebellion") [Mejba Revolt](https://en.wikipedia.org/wiki/Mejba_Revolt "Mejba Revolt") [Rebecca Riots](https://en.wikipedia.org/wiki/Rebecca_Riots "Rebecca Riots") [Saminism Movement](https://en.wikipedia.org/wiki/Saminism_Movement "Saminism Movement") [Tancament de Caixes](https://en.wikipedia.org/wiki/Tancament_de_Caixes "Tancament de Caixes") [Tithe War](https://en.wikipedia.org/wiki/Tithe_War "Tithe War") [Wallachian uprising](https://en.wikipedia.org/wiki/Wallachian_uprising_of_1821 "Wallachian uprising of 1821") |
| 20th | [Agbekoya](https://en.wikipedia.org/wiki/Agbekoya "Agbekoya") [Bambatha Rebellion](https://en.wikipedia.org/wiki/Bambatha_Rebellion "Bambatha Rebellion") [Bardoli Satyagraha](https://en.wikipedia.org/wiki/Bardoli_Satyagraha "Bardoli Satyagraha") [Beit Sahour](https://en.wikipedia.org/wiki/Beit_Sahour "Beit Sahour") [Bondelswarts affair](https://en.wikipedia.org/wiki/Bondelswarts_affair "Bondelswarts affair") [Champaran Satyagraha](https://en.wikipedia.org/wiki/Champaran_Satyagraha "Champaran Satyagraha") [Gordon Kahl](https://en.wikipedia.org/wiki/Gordon_Kahl "Gordon Kahl") [Kheda Satyagraha](https://en.wikipedia.org/wiki/Kheda_Satyagraha "Kheda Satyagraha") [Irwin Schiff](https://en.wikipedia.org/wiki/Irwin_Schiff "Irwin Schiff") [Johnson cult](https://en.wikipedia.org/wiki/Johnson_cult "Johnson cult") [Mau movement](https://en.wikipedia.org/wiki/Mau_movement "Mau movement") [Poll Tax Riots](https://en.wikipedia.org/wiki/Poll_Tax_Riots "Poll Tax Riots") [Poplar Rates Rebellion](https://en.wikipedia.org/wiki/Poplar_Rates_Rebellion "Poplar Rates Rebellion") [Tupper Saussy](https://en.wikipedia.org/wiki/Tupper_Saussy "Tupper Saussy") [Turra Coo](https://en.wikipedia.org/wiki/Turra_Coo "Turra Coo") [Salt March](https://en.wikipedia.org/wiki/Salt_March "Salt March") [Vedaranyam March](https://en.wikipedia.org/wiki/Vedaranyam_March "Vedaranyam March") [Women's poll tax repeal movement](https://en.wikipedia.org/wiki/Women%27s_poll_tax_repeal_movement "Women's poll tax repeal movement") [Women's War](https://en.wikipedia.org/wiki/Women%27s_War "Women's War") |
| 21st | [Anti-austerity movement in Greece](https://en.wikipedia.org/wiki/Anti-austerity_movement_in_Greece "Anti-austerity movement in Greece") [Anti-Bin Tax Campaign](https://en.wikipedia.org/wiki/Anti-Bin_Tax_Campaign "Anti-Bin Tax Campaign") [Edward and Elaine Brown standoff](https://en.wikipedia.org/wiki/Edward_and_Elaine_Brown "Edward and Elaine Brown") [Bonnets Rouges](https://en.wikipedia.org/wiki/Bonnets_Rouges "Bonnets Rouges") [Campaign Against Home and Water Taxes](https://en.wikipedia.org/wiki/Campaign_Against_Home_and_Water_Taxes "Campaign Against Home and Water Taxes") [Movimento Passe Livre](https://en.wikipedia.org/wiki/Movimento_Passe_Livre "Movimento Passe Livre") [Movimiento Pos Me Salto](https://en.wikipedia.org/wiki/Movimiento_Pos_Me_Salto "Movimiento Pos Me Salto") [Yellow vests protests](https://en.wikipedia.org/wiki/Yellow_vests_protests "Yellow vests protests") |
| Related topics | [Income tax threshold](https://en.wikipedia.org/wiki/Income_tax_threshold "Income tax threshold") [Potentially dangerous taxpayer](https://en.wikipedia.org/wiki/Potentially_dangerous_taxpayer "Potentially dangerous taxpayer") [Render unto Caesar](https://en.wikipedia.org/wiki/Render_unto_Caesar "Render unto Caesar") [Sovereign citizen](https://en.wikipedia.org/wiki/Sovereign_citizen_movement "Sovereign citizen movement") / [Freeman on the land](https://en.wikipedia.org/wiki/Freeman_on_the_land_movement "Freeman on the land movement") / [Redemption movement](https://en.wikipedia.org/wiki/Redemption_movement "Redemption movement") [Tax haven](https://en.wikipedia.org/wiki/Tax_haven "Tax haven") [Tax inversion](https://en.wikipedia.org/wiki/Tax_inversion "Tax inversion") [Tax noncompliance](https://en.wikipedia.org/wiki/Tax_noncompliance "Tax noncompliance") [Tax protester](https://en.wikipedia.org/wiki/Tax_protester "Tax protester") ([arguments](https://en.wikipedia.org/wiki/Tax_protester_arguments "Tax protester arguments") / [history in the United States](https://en.wikipedia.org/wiki/Tax_protester_history_in_the_United_States "Tax protester history in the United States")) [Tax riot](https://en.wikipedia.org/wiki/Tax_riot "Tax riot") [Taxation as slavery](https://en.wikipedia.org/wiki/Taxation_as_slavery "Taxation as slavery") [Taxation as theft](https://en.wikipedia.org/wiki/Taxation_as_theft "Taxation as theft") |
| [Authority control databases](https://en.wikipedia.org/wiki/Help:Authority_control "Help:Authority control") [](https://www.wikidata.org/wiki/Q329303#identifiers "Edit this at Wikidata") | |
|---|---|
| International | [GND](https://d-nb.info/gnd/4121725-1) |
| National | [France](https://catalogue.bnf.fr/ark:/12148/cb11972125d) [BnF data](https://data.bnf.fr/ark:/12148/cb11972125d) [Japan](https://id.ndl.go.jp/auth/ndlna/00571495) [Czech Republic](https://aleph.nkp.cz/F/?func=find-c&local_base=aut&ccl_term=ica=ph995308&CON_LNG=ENG) |
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Tax avoidance
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| Readable Markdown | This article is about the legal reduction of taxes. For the illegal equivalent, see [Tax evasion](https://en.wikipedia.org/wiki/Tax_evasion "Tax evasion"). For the refusal to pay tax, see [Tax resistance](https://en.wikipedia.org/wiki/Tax_resistance "Tax resistance").
**Tax avoidance** is the legal use of the [tax](https://en.wikipedia.org/wiki/Tax "Tax") regime in a single territory to one's own advantage to reduce the amount of tax that is payable. A [tax shelter](https://en.wikipedia.org/wiki/Tax_shelter "Tax shelter") is one type of tax avoidance, and [tax havens](https://en.wikipedia.org/wiki/Tax_havens "Tax havens") are jurisdictions that facilitate reduced taxes.[\[1\]](https://en.wikipedia.org/wiki/Tax_avoidance#cite_note-1) Tax avoidance should not be confused with [tax evasion](https://en.wikipedia.org/wiki/Tax_evasion "Tax evasion"), which is illegal.
Forms of tax avoidance that use legal tax laws in ways not necessarily intended by the government are often criticized in the [court of public opinion](https://en.wikipedia.org/wiki/Court_of_public_opinion "Court of public opinion") and by [journalists](https://en.wikipedia.org/wiki/Journalists "Journalists"). Many [businesses](https://en.wikipedia.org/wiki/Businesses "Businesses") pay little or no tax, and some experience a [backlash](https://en.wikipedia.org/wiki/Backlash_\(sociology\) "Backlash (sociology)") when their tax avoidance becomes known to the public. Conversely, benefiting from tax laws in ways that were intended by governments is sometimes referred to as **tax planning**.[\[2\]](https://en.wikipedia.org/wiki/Tax_avoidance#cite_note-2) The [World Bank](https://en.wikipedia.org/wiki/World_Bank "World Bank")'s [World Development Report](https://en.wikipedia.org/wiki/World_Development_Report "World Development Report") 2019 on the future of work supports increased government efforts to curb tax avoidance as part of a new [social contract](https://en.wikipedia.org/wiki/Social_contract "Social contract") focused on [human capital](https://en.wikipedia.org/wiki/Human_capital "Human capital") investments and expanded [social protection](https://en.wikipedia.org/wiki/Social_protection "Social protection").[\[3\]](https://en.wikipedia.org/wiki/Tax_avoidance#cite_note-3)
"Tax mitigation", "tax aggressive", "aggressive tax avoidance" or "tax neutral" schemes generally refer to multiterritory schemes that fall into the grey area between common and well-accepted tax avoidance, such as purchasing [municipal bonds](https://en.wikipedia.org/wiki/Municipal_bonds "Municipal bonds") in the United States, and tax evasion but are viewed by some as unethical, especially if they are involved in [profit-shifting](https://en.wikipedia.org/wiki/Base_erosion_and_profit_shifting "Base erosion and profit shifting") from high-tax to low-tax territories and territories recognised as tax havens.[\[4\]](https://en.wikipedia.org/wiki/Tax_avoidance#cite_note-4) Since 1995, trillions of dollars have been transferred from [OECD](https://en.wikipedia.org/wiki/OECD "OECD") and [developing countries](https://en.wikipedia.org/wiki/Developing_country "Developing country") into tax havens using these schemes.[\[5\]](https://en.wikipedia.org/wiki/Tax_avoidance#cite_note-5)
Laws known as a General Anti-Avoidance Rule (GAAR) statutes, which prohibit "aggressive" tax avoidance, have been passed in several countries and regions including Canada, Australia, New Zealand, South Africa, Norway, Hong Kong and the United Kingdom.[\[6\]](https://en.wikipedia.org/wiki/Tax_avoidance#cite_note-6)[\[7\]](https://en.wikipedia.org/wiki/Tax_avoidance#cite_note-UKGAAR-7) In addition, [judicial doctrines](https://en.wikipedia.org/wiki/Legal_doctrine "Legal doctrine") have accomplished the similar purpose, notably in the United States through the "business purpose" and "economic substance" doctrines established in *[Gregory v. Helvering](https://en.wikipedia.org/wiki/Gregory_v._Helvering "Gregory v. Helvering")* and in the United Kingdom in *[Ramsay](https://en.wikipedia.org/wiki/The_Ramsay_Principle "The Ramsay Principle")*. The specifics may vary according to jurisdiction, but such rules invalidate tax avoidance that is technically legal but is not for a business purpose or is in violation of the spirit of the tax code.[\[8\]](https://en.wikipedia.org/wiki/Tax_avoidance#cite_note-8)
The term "avoidance" has also been used in the tax regulations\[*examples and source needed*\] of some jurisdictions to distinguish tax avoidance foreseen by the legislators from tax avoidance exploiting [loopholes](https://en.wikipedia.org/wiki/Tax_break "Tax break") in the law such as [like-kind exchanges](https://en.wikipedia.org/wiki/Like-kind_exchange "Like-kind exchange").[\[9\]](https://en.wikipedia.org/wiki/Tax_avoidance#cite_note-9)[\[10\]](https://en.wikipedia.org/wiki/Tax_avoidance#cite_note-NYT01613-10)\[*correct example needed*\] The [US Supreme Court](https://en.wikipedia.org/wiki/US_Supreme_Court "US Supreme Court") has stated, "The legal right of an individual to decrease the amount of what would otherwise be his taxes or altogether avoid them, by means which the law permits, cannot be doubted".
Tax evasion, on the other hand, is the general term for efforts by individuals, corporations, [trusts](https://en.wikipedia.org/wiki/Trust_\(property\) "Trust (property)") and other entities to evade taxes by illegal means.
According to [Joseph Stiglitz](https://en.wikipedia.org/wiki/Joseph_Stiglitz "Joseph Stiglitz") (1986), there are three principles of tax avoidance: postponement of taxes, tax arbitrage across individuals facing different tax brackets, and tax arbitrage across income streams facing different tax treatment. Many tax avoidance devices include a combination of the three principles.
The postponement of taxes is the present discounted value of postponed tax is much less than of a tax currently paid. Tax arbitrage across individuals facing different tax brackets or the same individual facing different marginal tax rates at different times is an effective method of reducing tax liabilities within a family. However, according to Stiglitz (1986), differential tax rates may also lead to transactions among individuals in different brackets leading to “tax induced transactions”. The last principle is the tax arbitrage across income streams facing different tax treatment.[\[11\]](https://en.wikipedia.org/wiki/Tax_avoidance#cite_note-11)
## Anti-avoidance measures
\[[edit](https://en.wikipedia.org/w/index.php?title=Tax_avoidance&action=edit§ion=1 "Edit section: Anti-avoidance measures")\]
An anti-avoidance measure is a rule that prevents the reduction of tax by legal arrangements, where those arrangements are put in place purely to reduce tax, and would not otherwise be regarded as a reasonable course of action.
### Legislative measures
\[[edit](https://en.wikipedia.org/w/index.php?title=Tax_avoidance&action=edit§ion=2 "Edit section: Legislative measures")\]
Two kind of anti-avoidance measures exist; General Anti Avoidance Rules (GAAR) and Specific Anti Avoidance Rules (SAAR). The GAAR implies a set of generic anti-avoidance rules, while SAAR targets a specific avoidance practice or technique. Also, there is a set of bilateral measures pursued thorough treaties or double taxation agreements (DTAAs), this can be done via various clauses.[\[12\]](https://en.wikipedia.org/wiki/Tax_avoidance#cite_note-Anti-Avoidance_Measures-12)
### Judicial anti-avoidance measures
\[[edit](https://en.wikipedia.org/w/index.php?title=Tax_avoidance&action=edit§ion=3 "Edit section: Judicial anti-avoidance measures")\]
Courts around the world have played an important role in developing SAAR and GAAR measures. But the two guiding principles in judicial anti-avoidance are business purpose rule and substance over form rule. The business purpose rule states that the transaction must serve as a business purpose. Which means that mere tax advantage cannot be the main business purpose. On the other hand, the substance over form principle is wider than the business rule and it is defined by the OECD as the ‘prevalence of economic or social reality over the literal wording of legal provisions’ (Ostwal, T.P.; Vijayaraghavan, Vikram 2010).[\[12\]](https://en.wikipedia.org/wiki/Tax_avoidance#cite_note-Anti-Avoidance_Measures-12)
### EU Anti-Tax Avoidance Package
\[[edit](https://en.wikipedia.org/w/index.php?title=Tax_avoidance&action=edit§ion=4 "Edit section: EU Anti-Tax Avoidance Package")\]
The Anti-Tax Avoidance Package is part of the European Commission's agenda as an effort to implement a more effective corporate taxation in the European Union. This package was implemented in 2016 and offers measures to prevent aggressive tax planning and encourage of tax transparency among others. The Anti- Tax Avoidance Package counts with an Anti-Tax avoidance directive, recommendation on Tax Treaties, revised administrative cooperation directive and communication on external strategy.[\[13\]](https://en.wikipedia.org/wiki/Tax_avoidance#cite_note-13)
**Anti-Tax Avoidance Directive (ATAD)**: On 20 June 2016 the European Council adopted the Directive (EU) 2016/1164 which contains five legally binding anti-abuse measures that should be applied as common forms of aggressive tax legislations. The member States must have applied these measures as from 1 January 2019. ATAD contains the following five anti-abuse measures: 1. Interest deductibility, to discourage artificial debt arrangements which are design to minimise taxes, 2. Exit taxation, for preventing the avoidance of taxes when companies are re-locating assets, 3. Incorporation of the GAAR for disregarding of non-genuine arrangements, 4. Controlled Foreign Company Rule (CFC), to deter that the profit is transferred to a low or no tax country, 5. Switchover rule, to prevent double non-taxation.[\[14\]](https://en.wikipedia.org/wiki/Tax_avoidance#cite_note-14)
### Anti-avoidance measures by country
\[[edit](https://en.wikipedia.org/w/index.php?title=Tax_avoidance&action=edit§ion=5 "Edit section: Anti-avoidance measures by country")\]
Australia has a strong tax regime regarding avoidance which applies to large corporate groups, underpinned by the General Anti- Avoidance Rule (GAAR) adopted since 1981 with the Income Tax Act.[\[15\]](https://en.wikipedia.org/wiki/Tax_avoidance#cite_note-Office-15) The multinational anti-avoidance law (MAAL) is an extension of Australia's general anti-avoidance rules. This aims to make multinational enterprises pay their fair share of tax of the profits received and earned in Australia[\[15\]](https://en.wikipedia.org/wiki/Tax_avoidance#cite_note-Office-15)
Since 1980s there have been six major tax reforms in the US. The first one, in 1981, introduced a variety of tax loopholes. With this, the tax shelter industry boomed, giving rise to a demand for tax reform. The 1986 tax reform was the most accurate attempt at reducing tax avoidance, but then the next reforms of 1993 and 1997 opened new opportunities for tax avoidance and increased incentives of tax avoidance.[\[16\]](https://en.wikipedia.org/wiki/Tax_avoidance#cite_note-:0-16) The 1986 tax law reduced the demand for tax shelters and the opportunities for tax avoidance by constricting the gap between regular rates and the minimum tax rates. Lowering the top marginal rates, restricting the ability to use losses on just one type of income for balancing gains on other income and finally by taxing capital gains with full rates. There was another tax act in 1993, in which the alternative minimum tax rates were increased, also the regular rates, and an increase in the absolute gap for upper-income people. In the 1997 act, a gap between the rates at which capital gains and ordinary income was introduced to all taxpayers. During the 2001 and 2003 tax acts introduced more opportunities for tax avoidance because the gap between the capital gains and ordinary income tax remained the same as both rates were reduced by 5%. Finally, in the 2013 tax act, increased the tax on capital gains and ordinary income to 20 and 39.6% respectively.[\[16\]](https://en.wikipedia.org/wiki/Tax_avoidance#cite_note-:0-16)
### Country of residence
\[[edit](https://en.wikipedia.org/w/index.php?title=Tax_avoidance&action=edit§ion=9 "Edit section: Country of residence")\]
A company may choose to avoid taxes by establishing their company or subsidiaries in an [offshore jurisdiction](https://en.wikipedia.org/wiki/Offshore_financial_centre "Offshore financial centre") (see [offshore company](https://en.wikipedia.org/wiki/Offshore_company "Offshore company") and [offshore trust](https://en.wikipedia.org/wiki/Offshore_trust "Offshore trust")). Individuals may also avoid tax by moving their [tax residence](https://en.wikipedia.org/wiki/Tax_residence "Tax residence") to a [tax haven](https://en.wikipedia.org/wiki/Tax_haven "Tax haven"), such as [Monaco](https://en.wikipedia.org/wiki/Monaco "Monaco"), or by becoming [perpetual travelers](https://en.wikipedia.org/wiki/Perpetual_traveler "Perpetual traveler"). They may also reduce their tax by moving to a country with lower tax rates.
However, a small number of countries [tax their citizens on their worldwide income](https://en.wikipedia.org/wiki/International_taxation#Citizenship "International taxation") regardless of where they reside. As of 2012, only the United States and [Eritrea](https://en.wikipedia.org/wiki/Eritrea "Eritrea") have such a practice, whilst Finland, France, Hungary, Italy\[*[citation needed](https://en.wikipedia.org/wiki/Wikipedia:Citation_needed "Wikipedia:Citation needed")*\] and Spain apply it in limited circumstances. In cases such as the US, taxation cannot be avoided by simply transferring assets or moving abroad.[\[17\]](https://en.wikipedia.org/wiki/Tax_avoidance#cite_note-17)
The United States is unlike almost all other countries in that its citizens and permanent residents are subject to [U.S. federal income tax](https://en.wikipedia.org/wiki/Income_tax_in_the_United_States "Income tax in the United States") on their worldwide income even if they reside temporarily or permanently outside the United States. U.S. citizens therefore cannot avoid U.S. taxes simply by emigrating from the U.S. According to *[Forbes](https://en.wikipedia.org/wiki/Forbes "Forbes")* magazine some citizens choose to [give up](https://en.wikipedia.org/wiki/Renunciation_of_citizenship#United_States "Renunciation of citizenship") their [United States citizenship](https://en.wikipedia.org/wiki/United_States_citizenship "United States citizenship") rather than be subject to the [U.S. tax system](https://en.wikipedia.org/wiki/Taxation_in_the_United_States "Taxation in the United States");[\[18\]](https://en.wikipedia.org/wiki/Tax_avoidance#cite_note-18) but U.S. citizens who reside (or spend long periods of time) outside the U.S. may be able to exclude some salaried income earned overseas (but not other types of income unless specified in a bilateral tax treaty) from income in computing the U.S. federal income tax. The 2015 limit on the amount that can be excluded is US\$100,800. In addition, taxpayers can exclude or deduct certain foreign housing amounts. They may also be entitled to exclude from income the value of meals and lodging provided by their employer.[\[19\]](https://en.wikipedia.org/wiki/Tax_avoidance#cite_note-19) Some American parents do not register their children's birth abroad with American authorities, because they do not want their children to be required to report all earnings to the IRS and pay American taxes for their entire lives, even if they never visit the United States.[\[20\]](https://en.wikipedia.org/wiki/Tax_avoidance#cite_note-20)
Most countries impose taxes on income earned or gains realized within that country regardless of the country of residence of the person or firm. Most countries have entered into bilateral [double taxation](https://en.wikipedia.org/wiki/Double_taxation "Double taxation") treaties with many other countries to avoid taxing nonresidents twice—once where the income is earned and again in the country of residence (and perhaps, for U.S. citizens, taxed yet again in the country of citizenship)—however, there are relatively few double-taxation treaties with countries regarded as tax havens.[\[21\]](https://en.wikipedia.org/wiki/Tax_avoidance#cite_note-21) To avoid tax, it is usually not enough to simply move one's assets to a tax haven. One must also personally move to a tax haven (and, for U.S. citizens, renounce one's citizenship) to avoid tax.
Without changing country of residence (or, if a U.S. citizen, without giving up one's citizenship), personal taxation may be legally avoided by the creation of a separate [legal entity](https://en.wikipedia.org/wiki/Juristic_person "Juristic person") to which one's property is donated. The separate legal entity is often a [company](https://en.wikipedia.org/wiki/Company_\(law\) "Company (law)"), [trust](https://en.wikipedia.org/wiki/Trust_company "Trust company"), or [foundation](https://en.wikipedia.org/wiki/Foundation_\(nonprofit_organization\) "Foundation (nonprofit organization)"). These may also be located offshore, such as in the case of many [private foundations](https://en.wikipedia.org/wiki/Private_foundation "Private foundation"). Assets are transferred to the new company or trust so that gains may be realized, or income earned, within this legal entity rather than earned by the original owner. If assets are later transferred back to an individual, then [capital gains taxes](https://en.wikipedia.org/wiki/Capital_gains_tax "Capital gains tax") would apply on all profits. Also [income tax](https://en.wikipedia.org/wiki/Income_tax "Income tax") would still be due on any [salary](https://en.wikipedia.org/wiki/Salary "Salary") or [dividend](https://en.wikipedia.org/wiki/Dividend "Dividend") drawn from the legal entity.
For a [settlor](https://en.wikipedia.org/wiki/Settlor "Settlor") (creator of a trust) to avoid tax there may be restrictions on the type, purpose and beneficiaries of the trust. For example, the settlor of the trust may not be allowed to be a [trustee](https://en.wikipedia.org/wiki/Trustee "Trustee") or even a [beneficiary](https://en.wikipedia.org/wiki/Beneficiary_\(trust\) "Beneficiary (trust)") and may thus lose control of the assets transferred and/or may be unable to benefit from them.
Tax results depend on definitions of legal terms which are usually vague. For example, vagueness of the distinction between "business expenses" and "personal expenses" is of much concern for taxpayers and tax authorities. More generally, any term of tax law has a vague penumbra, and is a potential source of tax avoidance.[\[22\]](https://en.wikipedia.org/wiki/Tax_avoidance#cite_note-22)
[Tax shelters](https://en.wikipedia.org/wiki/Tax_shelter "Tax shelter") are investments that allow, and purport to allow, a reduction in one's income tax liability. Although things such as home ownership, pension plans, and Individual Retirement Accounts (IRAs) can be broadly considered "tax shelters", insofar as funds in them are not taxed, provided that they are held within the Individual Retirement Account for the required amount of time, the term "tax shelter" was originally used to describe primarily certain investments made in the form of limited partnerships, some of which were deemed by the U.S. Internal Revenue Service to be abusive.
The Internal Revenue Service and the [United States Department of Justice](https://en.wikipedia.org/wiki/United_States_Department_of_Justice "United States Department of Justice") have recently teamed up to crack down on abusive tax shelters. In 2003 the Senate's Permanent Subcommittee on Investigations held hearings about tax shelters which are entitled *U.S. tax shelter industry: the role of accountants, lawyers, and financial professionals*. Many of these tax shelters were designed and provided by accountants at the large American accounting firms.
Examples of U.S. tax shelters include: Foreign Leveraged Investment Program (FLIP) and Offshore Portfolio Investment Strategy (OPIS). Both were devised by partners at the accounting firm, KPMG. These tax shelters were also known as "basis shifts" or "defective redemptions."
Prior to 1987, passive investors in certain limited partnerships (such as [oil exploration](https://en.wikipedia.org/wiki/Oil_exploration "Oil exploration") or real estate investment ventures) were allowed to use the passive losses (if any) of the partnership (i.e., losses generated by partnership operations in which the investor took no material active part) to offset the investors' income, lowering the amount of income tax that otherwise would be owed by the investor. These partnerships could be structured so that an investor in a high tax bracket could obtain a net economic benefit from partnership-generated passive losses.
In the [Tax Reform Act of 1986](https://en.wikipedia.org/wiki/Tax_Reform_Act_of_1986 "Tax Reform Act of 1986") the U.S. Congress introduced the limitation (under [26 U.S.C.](https://en.wikipedia.org/wiki/Internal_Revenue_Code "Internal Revenue Code") [§ 469](https://www.law.cornell.edu/uscode/text/26/469)) on the deduction of passive losses and the use of passive activity tax credits. The 1986 Act also changed the "at risk" loss rules of [26 U.S.C.](https://en.wikipedia.org/wiki/Internal_Revenue_Code "Internal Revenue Code") [§ 465](https://www.law.cornell.edu/uscode/text/26/465). Coupled with the hobby loss rules ([26 U.S.C.](https://en.wikipedia.org/wiki/Internal_Revenue_Code "Internal Revenue Code") [§ 183](https://www.law.cornell.edu/uscode/text/26/183)), the changes greatly reduced tax avoidance by taxpayers engaged in activities only to generate deductible losses.
Taxpayers normally subject to [estate taxes](https://en.wikipedia.org/wiki/Estate_tax "Estate tax") or [gift taxes](https://en.wikipedia.org/wiki/Gift_taxes "Gift taxes") can reduce their tax liability through the use of trusts. One such strategy, common among [high-net-worth individuals](https://en.wikipedia.org/wiki/High-net-worth_individual "High-net-worth individual"), is the [grantor retained annuity trust](https://en.wikipedia.org/wiki/Grantor_retained_annuity_trust "Grantor retained annuity trust"). Instead of passing assets directly through the estate to the heir, the taxpayer can place assets expected to grow in value in an [irrevocable trust](https://en.wikipedia.org/wiki/Irrevocable_trust "Irrevocable trust") that ultimately benefits the heir. While the original amount placed in the trust is subject to estate taxes, any [capital gains](https://en.wikipedia.org/wiki/Capital_gain "Capital gain") are passed to the heir without being subject to taxation.[\[23\]](https://en.wikipedia.org/wiki/Tax_avoidance#cite_note-23)
[Share repurchases](https://en.wikipedia.org/wiki/Share_repurchase "Share repurchase") allow stockholders instead of paying [dividend tax](https://en.wikipedia.org/wiki/Dividend_tax "Dividend tax") to pay lower [capital gains taxes](https://en.wikipedia.org/wiki/Capital_gains_tax "Capital gains tax").[\[24\]](https://en.wikipedia.org/wiki/Tax_avoidance#cite_note-24)
According to a 2022 study, 36% of the profits of multinational firms are shifted to tax havens.[\[25\]](https://en.wikipedia.org/wiki/Tax_avoidance#cite_note-:12-25) If the profits had been reallocated to their domestic source, "domestic profits would increase by about 20% in high-tax European Union countries, 10% in the United States, and 5% in developing countries, while they would fall by 55% in tax havens."[\[25\]](https://en.wikipedia.org/wiki/Tax_avoidance#cite_note-:12-25)
[HMRC](https://en.wikipedia.org/wiki/HMRC "HMRC"), the UK tax collection agency, estimated that the overall cost of tax avoidance in the UK in 2016-17 was £1.7 billion, of which £0.7 billion was loss of income tax, National Insurance contributions and Capital Gains Tax. The rest came from loss of Corporation Tax, VAT and other direct taxes.[\[26\]](https://en.wikipedia.org/wiki/Tax_avoidance#cite_note-HMRCtaxgap-26) This compares to the wider tax gap (the difference between the amount of tax that should, in theory, be collected by HMRC, against what is actually collected) in that year of £33 billion.[\[26\]](https://en.wikipedia.org/wiki/Tax_avoidance#cite_note-HMRCtaxgap-26)
Figures published by the Tax Justice Network show that the UK had one of the lowest rates of tax losses due to profit shifting by multinational companies, with the fourth lowest rate out of 102 countries studied.[\[27\]](https://en.wikipedia.org/wiki/Tax_avoidance#cite_note-27) According to the figures, the UK lost £1 billion from profit shifting, around 0.04% of its GDP, coming behind Botswana (0.02%), Ecuador (0.02%) and Sweden (0.004%).[\[28\]](https://en.wikipedia.org/wiki/Tax_avoidance#cite_note-28)
#### Large companies accused of tax avoidance
\[[edit](https://en.wikipedia.org/w/index.php?title=Tax_avoidance&action=edit§ion=18 "Edit section: Large companies accused of tax avoidance")\]
In 2008 it was reported by [Private Eye](https://en.wikipedia.org/wiki/Private_Eye "Private Eye") that [Tesco](https://en.wikipedia.org/wiki/Tesco "Tesco") utilized offshore holding companies in Luxembourg and partnership agreements to reduce corporation tax liability by up to £50 million a year.[\[29\]](https://en.wikipedia.org/wiki/Tax_avoidance#cite_note-leigh-29) Another scheme previously identified by Private Eye involved depositing £1 billion in a Swiss partnership, and then loaning out that money to overseas Tesco stores, so that profit can be transferred indirectly through interest payments. This scheme is reported to remain in operation and is estimated to be costing the UK exchequer up to £20 million a year in corporation tax.[\[29\]](https://en.wikipedia.org/wiki/Tax_avoidance#cite_note-leigh-29)[\[30\]](https://en.wikipedia.org/wiki/Tax_avoidance#cite_note-30)
In 2011, [ActionAid](https://en.wikipedia.org/wiki/ActionAid "ActionAid") reported that 25% of the [FTSE 100](https://en.wikipedia.org/wiki/FTSE_100_Index "FTSE 100 Index") companies avoided taxation by locating their subsidiaries in tax havens. This increased to 98% when using the stricter US Congress definition of tax haven and [bank secrecy](https://en.wikipedia.org/wiki/Bank_secrecy "Bank secrecy") jurisdictions.[\[31\]](https://en.wikipedia.org/wiki/Tax_avoidance#cite_note-31) In 2016, it was reported in the *[Private Eye](https://en.wikipedia.org/wiki/Private_Eye "Private Eye")* current affairs magazine that four out of the FTSE top 10 companies paid no corporation tax at all.[\[32\]](https://en.wikipedia.org/wiki/Tax_avoidance#cite_note-PEye24/1/16-32)
Tax avoidance by corporations came to national attention in 2012, when MPs singled out [Google](https://en.wikipedia.org/wiki/Google "Google"), [Amazon.com](https://en.wikipedia.org/wiki/Amazon.com "Amazon.com") and [Starbucks](https://en.wikipedia.org/wiki/Starbucks "Starbucks") for criticism.[\[33\]](https://en.wikipedia.org/wiki/Tax_avoidance#cite_note-33) Following accusations that the three companies were diverting hundreds of millions of pounds in UK profits to secretive tax havens, there was widespread outrage across the UK, followed by boycotts of products by Google, Amazon.com and Starbucks.[\[34\]](https://en.wikipedia.org/wiki/Tax_avoidance#cite_note-34)[\[35\]](https://en.wikipedia.org/wiki/Tax_avoidance#cite_note-35) Following the boycotts and damage to brand image, Starbucks promised to move its tax base from the Netherlands to London and to pay [HMRC](https://en.wikipedia.org/wiki/HMRC "HMRC") £20million,[\[36\]](https://en.wikipedia.org/wiki/Tax_avoidance#cite_note-36) but executives from Amazon.com and Google defended their tax avoidance as being within the law.
[Google has remained the subject of criticism](https://en.wikipedia.org/wiki/Criticism_of_Google#Tax_avoidance "Criticism of Google") in the UK regarding their use of the '[Double Irish](https://en.wikipedia.org/wiki/Double_Irish_arrangement "Double Irish arrangement")', [Dutch Sandwich](https://en.wikipedia.org/wiki/Dutch_Sandwich_\(tax_avoidance\) "Dutch Sandwich (tax avoidance)") and [Bermuda Black Hole](https://en.wikipedia.org/wiki/Bermuda_Black_Hole_\(tax_avoidance\) "Bermuda Black Hole (tax avoidance)") tax avoidance schemes.[\[37\]](https://en.wikipedia.org/wiki/Tax_avoidance#cite_note-37) Similarly, Amazon remains the subject of criticism across the UK and [EU](https://en.wikipedia.org/wiki/EU "EU") for its tax avoidance. In October 2017, the EU ordered Amazon to repay €250 million in illegal state aid to Luxembourg following a 'sweetheart deal' between Luxembourg and Amazon.com enabling the American company to artificially reduce its tax bill.[\[38\]](https://en.wikipedia.org/wiki/Tax_avoidance#cite_note-38) [PayPal](https://en.wikipedia.org/wiki/PayPal "PayPal"), [EBay](https://en.wikipedia.org/wiki/EBay "EBay"), [Microsoft](https://en.wikipedia.org/wiki/Microsoft "Microsoft"), [Twitter](https://en.wikipedia.org/wiki/Twitter "Twitter") and [Facebook](https://en.wikipedia.org/wiki/Facebook "Facebook") have also been found to be using the [Double Irish](https://en.wikipedia.org/wiki/Double_Irish "Double Irish") and [Dutch Sandwich](https://en.wikipedia.org/wiki/Dutch_Sandwich "Dutch Sandwich") schemes. Up to 1,000 individuals in the same year were also discovered to be using [K2](https://en.wikipedia.org/wiki/K2_\(tax_scheme\) "K2 (tax scheme)") to avoid tax.[\[39\]](https://en.wikipedia.org/wiki/Tax_avoidance#cite_note-39)
Other UK active corporations mentioned in relation to tax avoidance in 2015, particularly the Double Irish, Dutch Sandwich and Bermuda Black Hole:
- Technology: [Apple](https://en.wikipedia.org/wiki/Criticism_of_Apple_Inc. "Criticism of Apple Inc."), [Microsoft](https://en.wikipedia.org/wiki/Microsoft "Microsoft"), [PayPal](https://en.wikipedia.org/wiki/PayPal "PayPal"), [EBay](https://en.wikipedia.org/wiki/EBay "EBay"), [Intel](https://en.wikipedia.org/wiki/Intel "Intel"), [Yahoo\!](https://en.wikipedia.org/wiki/Yahoo! "Yahoo!"), [Facebook](https://en.wikipedia.org/wiki/Meta_Platforms "Meta Platforms"), [Uber](https://en.wikipedia.org/wiki/Uber "Uber"), [Netflix](https://en.wikipedia.org/wiki/Netflix,_Inc. "Netflix, Inc."), [Hewlett-Packard](https://en.wikipedia.org/wiki/Hewlett-Packard "Hewlett-Packard"), [IBM](https://en.wikipedia.org/wiki/IBM "IBM") and [Twitter](https://en.wikipedia.org/wiki/Twitter,_Inc. "Twitter, Inc.")[\[40\]](https://en.wikipedia.org/wiki/Tax_avoidance#cite_note-40)
- Retail: [Boots](https://en.wikipedia.org/wiki/Boots_UK "Boots UK") (who moved their registered office to a Swiss letterbox),[\[41\]](https://en.wikipedia.org/wiki/Tax_avoidance#cite_note-41) [Kellogg's](https://en.wikipedia.org/wiki/Kellogg%27s "Kellogg's"),[\[42\]](https://en.wikipedia.org/wiki/Tax_avoidance#cite_note-42) and [TopShop](https://en.wikipedia.org/wiki/TopShop "TopShop")[\[43\]](https://en.wikipedia.org/wiki/Tax_avoidance#cite_note-43)
- Football clubs: [Manchester United](https://en.wikipedia.org/wiki/Manchester_United "Manchester United"), [Birmingham City](https://en.wikipedia.org/wiki/Birmingham_City "Birmingham City"), [Coventry City](https://en.wikipedia.org/wiki/Coventry_City "Coventry City") and [Cheltenham Town](https://en.wikipedia.org/wiki/Cheltenham_Town "Cheltenham Town").[\[44\]](https://en.wikipedia.org/wiki/Tax_avoidance#cite_note-44)
- News: [Daily Mail](https://en.wikipedia.org/wiki/Daily_Mail "Daily Mail")[\[45\]](https://en.wikipedia.org/wiki/Tax_avoidance#cite_note-45)
Other corporations mentioned in relation to tax avoidance in later years have been [Vodafone](https://en.wikipedia.org/wiki/Vodafone "Vodafone"), [AstraZeneca](https://en.wikipedia.org/wiki/AstraZeneca "AstraZeneca"), [SABMiller](https://en.wikipedia.org/wiki/SABMiller "SABMiller"), [GlaxoSmithKline](https://en.wikipedia.org/wiki/GlaxoSmithKline "GlaxoSmithKline") and [British American Tobacco](https://en.wikipedia.org/wiki/British_American_Tobacco "British American Tobacco").[\[32\]](https://en.wikipedia.org/wiki/Tax_avoidance#cite_note-PEye24/1/16-32)
Tax avoidance has not always related to corporation tax. A number of companies including [Tesco](https://en.wikipedia.org/wiki/Tesco "Tesco"), [Sainsbury's](https://en.wikipedia.org/wiki/Sainsbury%27s "Sainsbury's"), [WH Smith](https://en.wikipedia.org/wiki/WH_Smith "WH Smith"), [Boots](https://en.wikipedia.org/wiki/Boots_UK "Boots UK") and [Marks and Spencer](https://en.wikipedia.org/wiki/Marks_and_Spencer "Marks and Spencer") used a scheme to avoid [VAT](https://en.wikipedia.org/wiki/VAT "VAT") by forcing customers paying by card to unknowingly pay a 2.5% 'card transaction fee', though the total charged to the customer remained the same. Such schemes came to light after [HMRC](https://en.wikipedia.org/wiki/HMRC "HMRC") litigated against [Debenhams](https://en.wikipedia.org/wiki/Debenhams "Debenhams") over the scheme during 2005.[\[46\]](https://en.wikipedia.org/wiki/Tax_avoidance#cite_note-46)
#### Small company tax avoidance
\[[edit](https://en.wikipedia.org/w/index.php?title=Tax_avoidance&action=edit§ion=19 "Edit section: Small company tax avoidance")\]
In the UK, small business tax avoidance has a substantial impact.[\[47\]](https://en.wikipedia.org/wiki/Tax_avoidance#cite_note-47) HMRC’s tax gap analysis of 2025 calculated that small business is responsible for 60% of an annual £47bn tax shortfall in the UK.[\[48\]](https://en.wikipedia.org/wiki/Tax_avoidance#cite_note-48)
#### General anti-avoidance rule
\[[edit](https://en.wikipedia.org/w/index.php?title=Tax_avoidance&action=edit§ion=20 "Edit section: General anti-avoidance rule")\]
Since the late 1990s, [New Labour](https://en.wikipedia.org/wiki/New_Labour "New Labour") consulted on a "general anti-avoidance rule" (GAAR) for taxation, before deciding against the idea. By 2003, public interest in a GAAR surged as evidence of the scale of tax avoidance used by individuals in the [financial](https://en.wikipedia.org/wiki/Financial_sector "Financial sector") and other sectors became apparent, though in its 2004 Budget the Labour Government announced a new "disclosure regime" as an alternative, whereby tax avoidance schemes would be required to be disclosed to the revenue departments.[\[49\]](https://en.wikipedia.org/wiki/Tax_avoidance#cite_note-49)
In December 2010, the new Coalition government commissioned a report which would consider whether there should be a general anti-avoidance rule for the UK, which recommended that the UK should introduce such a rule, which was introduced in 2013. The rule prevents the reduction of tax by legal arrangements, where those arrangements are put in place purely to reduce tax, and would not otherwise be regarded as a reasonable course of action.[\[7\]](https://en.wikipedia.org/wiki/Tax_avoidance#cite_note-UKGAAR-7)
Following the [Panama Papers](https://en.wikipedia.org/wiki/Panama_Papers "Panama Papers") leak in 2016, *[Private Eye](https://en.wikipedia.org/wiki/Private_Eye "Private Eye")*, *[The Guardian](https://en.wikipedia.org/wiki/The_Guardian "The Guardian")* and other British media outlets noted that [Edward Troup](https://en.wikipedia.org/wiki/Edward_Troup_\(solicitor\) "Edward Troup (solicitor)"), who became executive chair of [HM Revenue and Customs](https://en.wikipedia.org/wiki/HM_Revenue_and_Customs "HM Revenue and Customs"), had worked with [Simmons & Simmons](https://en.wikipedia.org/wiki/Simmons_%26_Simmons "Simmons & Simmons") in 2004 representing corporate tax havens and opposed the GAAR in 1998.[\[50\]](https://en.wikipedia.org/wiki/Tax_avoidance#cite_note-50)[\[51\]](https://en.wikipedia.org/wiki/Tax_avoidance#cite_note-51)[\[52\]](https://en.wikipedia.org/wiki/Tax_avoidance#cite_note-52)
#### Public sector appointments
\[[edit](https://en.wikipedia.org/w/index.php?title=Tax_avoidance&action=edit§ion=21 "Edit section: Public sector appointments")\]
In January 2012 a review of the tax arrangements of people engaged on public sector appointments was undertaken, in order to "ascertain the extent of arrangements which could allow public sector appointees to minimise their tax payments" and make recommendations accordingly.[\[53\]](https://en.wikipedia.org/wiki/Tax_avoidance#cite_note-ppn0712-53) The review was published on 23 May 2012, advising that:
- the most senior staff in public sector appointments should be on the payroll, unless there are exceptional temporary circumstances;
- through their contracting, departments must be able to seek formal assurance from contractors with off payroll arrangements lasting more than six months and costing over £220 per day that income tax and national insurance obligations were being met. Departments were advised to terminate a contract if that assurance was not provided;
- implementation would be monitored carefully with financial sanctions for departments which did not comply.[\[53\]](https://en.wikipedia.org/wiki/Tax_avoidance#cite_note-ppn0712-53)
#### Historical tax avoidance
\[[edit](https://en.wikipedia.org/w/index.php?title=Tax_avoidance&action=edit§ion=22 "Edit section: Historical tax avoidance")\]
[](https://en.wikipedia.org/wiki/File:Window_Tax.jpg)
Avoiding the [window tax](https://en.wikipedia.org/wiki/Window_tax "Window tax") in England
One historic example of tax avoidance still evident today was the payment of [window tax](https://en.wikipedia.org/wiki/Window_tax "Window tax"). It was introduced in [England and Wales](https://en.wikipedia.org/wiki/England_and_Wales "England and Wales") in 1696 with the aim of imposing tax on the relative prosperity of individuals without the controversy of introducing an [income tax](https://en.wikipedia.org/wiki/Income_tax "Income tax").[\[54\]](https://en.wikipedia.org/wiki/Tax_avoidance#cite_note-54) The bigger the house, the more windows it was likely to have, and the more tax the occupants would pay. Nevertheless, the tax was unpopular, because it was seen by some as a "tax on light" (allegedly leading to the phrase daylight robbery) and led property owners to block up windows to avoid it.[\[55\]](https://en.wikipedia.org/wiki/Tax_avoidance#cite_note-55) The tax was repealed in 1851.[\[56\]](https://en.wikipedia.org/wiki/Tax_avoidance#cite_note-56)
##### Deliberate roof destruction
\[[edit](https://en.wikipedia.org/w/index.php?title=Tax_avoidance&action=edit§ion=24 "Edit section: Deliberate roof destruction")\]
Other historic examples of tax avoidance were the [deliberate destructions](https://en.wikipedia.org/wiki/Ruins#Deliberate_destruction "Ruins") of roofs in Scotland to avoid substantial [property taxes](https://en.wikipedia.org/wiki/Property_tax "Property tax"). The roof of [Slains Castle](https://en.wikipedia.org/wiki/New_Slains_Castle "New Slains Castle") was removed in 1925, and the building has deteriorated since.[\[57\]](https://en.wikipedia.org/wiki/Tax_avoidance#cite_note-57) The owners of [Fetteresso Castle](https://en.wikipedia.org/wiki/Fetteresso_Castle "Fetteresso Castle") (now restored) deliberately destroyed their roof after [World War II](https://en.wikipedia.org/wiki/World_War_II "World War II") in protest at the new taxes.
The term tax avoidance indicates a situation in which a taxpayer legally minimizes the amount of his income tax owed. This circumstance occurs by declaring as many deductions and credits as permitted or prioritizing investments with tax advantages.[\[58\]](https://en.wikipedia.org/wiki/Tax_avoidance#cite_note-58)
An IRS report indicates that, in 2009, 1,470 individuals earning more than \$1,000,000 annually faced a net tax liability of zero or less.[\[59\]](https://en.wikipedia.org/wiki/Tax_avoidance#cite_note-59) Also, in 1998 alone, a total of 94 corporations faced a net liability of less than half the full 35% corporate tax rate and the corporations [Lyondell Chemical](https://en.wikipedia.org/wiki/Lyondell_Chemical "Lyondell Chemical"), [Texaco](https://en.wikipedia.org/wiki/Texaco "Texaco"), [Chevron](https://en.wikipedia.org/wiki/Chevron_Corporation "Chevron Corporation"), [CSX](https://en.wikipedia.org/wiki/CSX "CSX"), [Tosco](https://en.wikipedia.org/wiki/Tosco_Corporation "Tosco Corporation"), [PepsiCo](https://en.wikipedia.org/wiki/PepsiCo "PepsiCo"), [Owens & Minor](https://en.wikipedia.org/wiki/Owens_%26_Minor "Owens & Minor"), [Pfizer](https://en.wikipedia.org/wiki/Pfizer "Pfizer"), [JP Morgan](https://en.wikipedia.org/wiki/J.P._Morgan_%26_Co. "J.P. Morgan & Co."), [Saks](https://en.wikipedia.org/wiki/Saks_Incorporated "Saks Incorporated"), [Goodyear](https://en.wikipedia.org/wiki/Goodyear_Tire_and_Rubber_Company "Goodyear Tire and Rubber Company"), [Ryder](https://en.wikipedia.org/wiki/Ryder "Ryder"), [Enron](https://en.wikipedia.org/wiki/Enron "Enron"), [Colgate-Palmolive](https://en.wikipedia.org/wiki/Colgate-Palmolive "Colgate-Palmolive"), [Worldcom](https://en.wikipedia.org/wiki/Worldcom "Worldcom"), [Eaton](https://en.wikipedia.org/wiki/Eaton_Corporation "Eaton Corporation"), [Weyerhaeuser](https://en.wikipedia.org/wiki/Weyerhaeuser "Weyerhaeuser"), [General Motors](https://en.wikipedia.org/wiki/General_Motors "General Motors"), [El Paso Energy](https://en.wikipedia.org/wiki/El_Paso_Energy "El Paso Energy"), Westpoint Stevens, [MedPartners](https://en.wikipedia.org/wiki/MedPartners "MedPartners"), [Phillips Petroleum](https://en.wikipedia.org/wiki/Phillips_Petroleum "Phillips Petroleum"), [McKesson](https://en.wikipedia.org/wiki/McKesson_Corporation "McKesson Corporation") and [Northrop Grumman](https://en.wikipedia.org/wiki/Northrop_Grumman "Northrop Grumman") all had net negative tax liabilities.[\[60\]](https://en.wikipedia.org/wiki/Tax_avoidance#cite_note-60) Additionally, this phenomenon was widely documented regarding [General Electric](https://en.wikipedia.org/wiki/General_Electric "General Electric") in early 2011.[\[61\]](https://en.wikipedia.org/wiki/Tax_avoidance#cite_note-61)
Furthermore, a [Government Accountability Office](https://en.wikipedia.org/wiki/Government_Accountability_Office "Government Accountability Office") study found that, from 1998 to 2005, 55 percent of United States companies paid no federal income taxes during at least one year in a seven-year period it studied.[\[62\]](https://en.wikipedia.org/wiki/Tax_avoidance#cite_note-62)[\[63\]](https://en.wikipedia.org/wiki/Tax_avoidance#cite_note-63) A review in 2011 by [Citizens for Tax Justice](https://en.wikipedia.org/wiki/Citizens_for_Tax_Justice "Citizens for Tax Justice") and the [Institute on Taxation and Economic Policy](https://en.wikipedia.org/wiki/Institute_on_Taxation_and_Economic_Policy "Institute on Taxation and Economic Policy") of companies in the Fortune 500 profitable every year from 2008 through 2010 stated these companies paid an average tax rate of 18.5% and that 30 of these companies actually had a [negative income tax](https://en.wikipedia.org/wiki/Negative_income_tax "Negative income tax") due.[\[64\]](https://en.wikipedia.org/wiki/Tax_avoidance#cite_note-64)
In 2012, [Hewlett-Packard](https://en.wikipedia.org/wiki/Hewlett-Packard "Hewlett-Packard") lost a lawsuit with the IRS over a "foreign tax credit generator" which was engineered by a division of [AIG](https://en.wikipedia.org/wiki/AIG "AIG").[\[65\]](https://en.wikipedia.org/wiki/Tax_avoidance#cite_note-65) [Al Jazeera](https://en.wikipedia.org/wiki/Al_Jazeera_Arabic "Al Jazeera Arabic") also wrote in 2012 that "Rich individuals and their families have as much as \$32 trillion of hidden financial assets in offshore tax havens, representing up to \$280bn in lost income tax revenues ... John Christensen of the [Tax Justice Network](https://en.wikipedia.org/wiki/Tax_Justice_Network "Tax Justice Network") told Al Jazeera that he was shocked by 'the sheer scale of the figures'. ... 'We're talking about very big, well-known brands – [HSBC](https://en.wikipedia.org/wiki/HSBC "HSBC"), [Citigroup](https://en.wikipedia.org/wiki/Citigroup "Citigroup"), [Bank of America](https://en.wikipedia.org/wiki/Bank_of_America "Bank of America"), [UBS](https://en.wikipedia.org/wiki/UBS "UBS"), [Credit Suisse](https://en.wikipedia.org/wiki/Credit_Suisse "Credit Suisse") ... and they do it knowing fully well that their clients, more often than not, are evading and avoiding taxes.' Much of this activity, Christensen added, was illegal."[\[66\]](https://en.wikipedia.org/wiki/Tax_avoidance#cite_note-66)
As a result of the tax sheltering, the government responded with Treasury Department [Circular 230](https://en.wikipedia.org/wiki/Circular_230 "Circular 230"). In 2010, the [Health Care and Education Reconciliation Act of 2010](https://en.wikipedia.org/wiki/Health_Care_and_Education_Reconciliation_Act_of_2010 "Health Care and Education Reconciliation Act of 2010") codified the "economic substance" rule of *[Gregory v. Helvering](https://en.wikipedia.org/wiki/Gregory_v._Helvering "Gregory v. Helvering")* (1935).[\[67\]](https://en.wikipedia.org/wiki/Tax_avoidance#cite_note-67)
The US [Public Interest Research Group](https://en.wikipedia.org/wiki/Public_Interest_Research_Group "Public Interest Research Group") said in 2014 that the [United States](https://en.wikipedia.org/wiki/United_States "United States") government loses roughly \$184 billion per year due to corporations such as Pfizer, Microsoft and Citigroup using offshore tax havens to avoid paying US taxes. According to PIRG:
- [Pfizer](https://en.wikipedia.org/wiki/Pfizer "Pfizer") paid no US income taxes 2010–2012, despite earning \$43 billion. The corporation received more than \$2 billion in federal tax refunds. In 2013, Pfizer operated 128 subsidiaries in tax havens and had \$69 billion offshore which could not be collected by the [Internal Revenue Service](https://en.wikipedia.org/wiki/Internal_Revenue_Service "Internal Revenue Service") (IRS);
- [Microsoft](https://en.wikipedia.org/wiki/Microsoft "Microsoft") maintains five tax haven subsidiaries and held \$76.4 billion overseas in 2013, thus saving the corporation \$24.4 billion in taxes;
- [Citigroup](https://en.wikipedia.org/wiki/Citigroup "Citigroup") maintained 21 subsidiaries in tax haven countries in 2013, and kept \$43.8 billion in offshore jurisdictions, thus saving the corporation an additional \$11.7 billion in taxes.[\[68\]](https://en.wikipedia.org/wiki/Tax_avoidance#cite_note-U.S._PIRG-68)
According to an analysis by the [Institute on Taxation and Economic Policy](https://en.wikipedia.org/wiki/Institute_on_Taxation_and_Economic_Policy "Institute on Taxation and Economic Policy"), global companies in the US are paying an effective tax rate of about negative 9 percent per annum.[\[69\]](https://en.wikipedia.org/wiki/Tax_avoidance#cite_note-69)
An investigation by [ProPublica](https://en.wikipedia.org/wiki/ProPublica "ProPublica") published in 2021 based on leaked IRS documents revealed techniques by which billionaires accumulated massive wealth while paying lower rates than middle-income people, or no tax, or in some cases getting paid refundable childcare tax credits.[\[70\]](https://en.wikipedia.org/wiki/Tax_avoidance#cite_note-70) These include:
- Instead of a salary taxed at the 37% top rate, accepting stock, which is taxed at the 20% [capital gains](https://en.wikipedia.org/wiki/Capital_gains "Capital gains") rate.
- Avoid paying tax on capital gains with the "[buy, borrow, die](https://en.wikipedia.org/w/index.php?title=Buy,_borrow,_die&action=edit&redlink=1 "Buy, borrow, die (page does not exist)")" technique[\[71\]](https://en.wikipedia.org/wiki/Tax_avoidance#cite_note-71):
- Buy or earn capital assets like stocks and real estate, and then never sell because assets do not count as income until sold.
- Using capital assets as [collateral](https://en.wikipedia.org/wiki/Collateral_\(finance\) "Collateral (finance)") to borrow spending money at interest rates considerably lower than the tax rate; loans are not taxed as income.
- Holding capital assets until after death, when a "[step-up in basis](https://en.wikipedia.org/wiki/Step-up_in_basis "Step-up in basis")" zeroes out the accumulated gains and allows heirs to not pay any capital gains tax.
- Avoid the [estate tax](https://en.wikipedia.org/wiki/Estate_tax "Estate tax") by moving money into [trusts](https://en.wikipedia.org/wiki/Trust_law "Trust law") or charitable foundations before death
- Offset [dividend](https://en.wikipedia.org/wiki/Dividend "Dividend") income with the interest paid on loans, or relying on increasing stock prices instead of a dividend
- Offset income with "paper" losses in business operations
- Offset income with [charitable contributions](https://en.wikipedia.org/wiki/Charitable_contribution "Charitable contribution")
Tax avoidance may be considered to be the dodging of one's duties to society, or alternatively the right of every citizen to structure one's affairs in a manner allowed by law, to pay no more tax than what is required. Attitudes vary from approval through neutrality to outright hostility. Attitudes may vary depending on the steps taken in the avoidance scheme, or the perceived unfairness of the tax being avoided.[\[72\]](https://en.wikipedia.org/wiki/Tax_avoidance#cite_note-72)
In 2008, the charity [Christian Aid](https://en.wikipedia.org/wiki/Christian_Aid "Christian Aid") published a report, *Death and taxes: the true toll of tax dodging*, which criticised tax exiles and tax avoidance by some of the world's largest companies, linking [tax evasion](https://en.wikipedia.org/wiki/Tax_evasion "Tax evasion") to the deaths of millions of children in developing countries.[\[73\]](https://en.wikipedia.org/wiki/Tax_avoidance#cite_note-73) However the research behind these calculations has been questioned in a 2009 paper prepared for the UK [Department for International Development](https://en.wikipedia.org/wiki/Department_for_International_Development "Department for International Development").[\[74\]](https://en.wikipedia.org/wiki/Tax_avoidance#cite_note-74) According to the *Financial Times* there is a growing trend for charities to prioritise tax avoidance as a key campaigning issue, with policy makers across the world considering changes to make tax avoidance more difficult.[\[75\]](https://en.wikipedia.org/wiki/Tax_avoidance#cite_note-75)
In 2010, tax avoidance became a hot-button issue in the UK. An organisation, [UK Uncut](https://en.wikipedia.org/wiki/UK_Uncut "UK Uncut"), began to encourage people to protest at local high-street shops that were thought to be avoiding tax, such as [Vodafone](https://en.wikipedia.org/wiki/Vodafone "Vodafone"), [Topshop](https://en.wikipedia.org/wiki/Topshop "Topshop") and the [Arcadia Group](https://en.wikipedia.org/wiki/Arcadia_Group "Arcadia Group").[\[76\]](https://en.wikipedia.org/wiki/Tax_avoidance#cite_note-76)
In 2012, during the [Occupy movement](https://en.wikipedia.org/wiki/Occupy_movement "Occupy movement") in the United States, tax avoidance for the 99% was proposed as a protest tool.[\[77\]](https://en.wikipedia.org/wiki/Tax_avoidance#cite_note-77)
[Prem Sikka](https://en.wikipedia.org/wiki/Prem_Sikka "Prem Sikka"), Professor of Accounting at the Essex Business School (University of Essex) and scientific advisor of the [Tax Justice Network](https://en.wikipedia.org/wiki/Tax_Justice_Network "Tax Justice Network") pointed to a discrepancy between the [Corporate Social Responsibility](https://en.wikipedia.org/wiki/Corporate_Social_Responsibility "Corporate Social Responsibility") claims of multinational companies and “their internal dynamics aimed at maximising their profits through things like tax avoidance”. He wrote in an article commenting the Lux Leaks publications: “Big corporations and accountancy firms are engaged in organised hypocrisy.”[\[78\]](https://en.wikipedia.org/wiki/Tax_avoidance#cite_note-78)
Public polling undertaken in the UK in 2025 has found continued high levels of concern around corporate tax avoidance and agreement for regulations to be tightened.[\[79\]](https://en.wikipedia.org/wiki/Tax_avoidance#cite_note-79)
Surveys conducted in 2025 in each of the EU's 27 Member States have found high levels of support for large multinationals contributing toward a global minimum tax in each country in which they operate.[\[80\]](https://en.wikipedia.org/wiki/Tax_avoidance#cite_note-80)
As a response to public opinion regarding tax avoidance, the [Fair Tax Mark](https://en.wikipedia.org/wiki/Fair_Tax_Mark "Fair Tax Mark") was established in the UK during 2014 as an independent certification scheme to identify and recognise companies which pay taxes "in accordance with the spirit of all tax laws" and not to use options, allowances, or reliefs, or undertake specific transactions, "that are contrary to the spirit of the law".[\[81\]](https://en.wikipedia.org/wiki/Tax_avoidance#cite_note-81)[\[82\]](https://en.wikipedia.org/wiki/Tax_avoidance#cite_note-82)
The Mark is operated by a not-for-profit community benefit society, the **Fair Tax Foundation**.
Awardees of this mark in the UK include [The Co-op](https://en.wikipedia.org/wiki/The_Co-operative_Group "The Co-operative Group"),[\[83\]](https://en.wikipedia.org/wiki/Tax_avoidance#cite_note-83) [SSE](https://en.wikipedia.org/wiki/SSE_plc "SSE plc"), [Watches of Switzerland](https://en.wikipedia.org/wiki/Watches_of_Switzerland "Watches of Switzerland"), [Ecology Building Society](https://en.wikipedia.org/wiki/Ecology_Building_Society "Ecology Building Society"), [Lush Cosmetics](https://en.wikipedia.org/wiki/Lush_\(company\) "Lush (company)"), [Richer Sounds](https://en.wikipedia.org/wiki/Richer_Sounds "Richer Sounds"), [Scottish Water](https://en.wikipedia.org/wiki/Scottish_Water "Scottish Water"), [United Utilities](https://en.wikipedia.org/wiki/United_Utilities "United Utilities"), [Marshalls](https://en.wikipedia.org/wiki/Marshalls "Marshalls"), several large regional co-operatives ([East of England](https://en.wikipedia.org/wiki/East_of_England_Co-operative_Society "East of England Co-operative Society"), [Midcounties](https://en.wikipedia.org/wiki/Midcounties_Co-operative "Midcounties Co-operative"), [Scotmid](https://en.wikipedia.org/wiki/Scotmid_Co-operative "Scotmid Co-operative")) and [The Phone Co-op](https://en.wikipedia.org/wiki/The_Phone_Co-op "The Phone Co-op"). Outside of the UK, awardees include [Iberdrola](https://en.wikipedia.org/wiki/Iberdrola "Iberdrola"),[\[84\]](https://en.wikipedia.org/wiki/Tax_avoidance#cite_note-84) [Orsted](https://en.wikipedia.org/wiki/%C3%98rsted_\(company\) "Ørsted (company)")[\[85\]](https://en.wikipedia.org/wiki/Tax_avoidance#cite_note-85) and [Vattenfall](https://en.wikipedia.org/wiki/Vattenfall "Vattenfall").[\[86\]](https://en.wikipedia.org/wiki/Tax_avoidance#cite_note-86)
## Government and judicial response
\[[edit](https://en.wikipedia.org/w/index.php?title=Tax_avoidance&action=edit§ion=28 "Edit section: Government and judicial response")\]
[](https://en.wikipedia.org/wiki/File:Countries_implicated_in_the_Panama_Papers.svg)
Countries with politicians, public officials or close associates implicated in the [Panama Papers](https://en.wikipedia.org/wiki/Panama_Papers "Panama Papers") leak on 15 April 2016
Tax avoidance reduces government revenue, so governments with a stricter anti-avoidance stance seek to prevent tax avoidance or keep it within limits. The obvious way to do this is to frame tax rules so that there is a smaller scope for avoidance. In practice this has not always been achievable and has led to an ongoing battle between governments amending legislation and [tax advisors](https://en.wikipedia.org/wiki/Tax_advisor "Tax advisor") finding new scope/loopholes for tax avoidance in the amended rules.\[*[citation needed](https://en.wikipedia.org/wiki/Wikipedia:Citation_needed "Wikipedia:Citation needed")*\]
To allow prompter response to tax avoidance schemes, the US Tax Disclosure Regulations (2003) require prompter and fuller disclosure than previously required, a tactic which was applied in the UK in 2004.
Some countries such as Canada, Australia, United Kingdom and New Zealand have introduced a statutory **General Anti-Avoidance Rule** (or **General Anti-Abuse Rule**, **GAAR**). Canada also uses [Foreign Accrual Property Income](https://en.wikipedia.org/w/index.php?title=Foreign_Accrual_Property_Income&action=edit&redlink=1 "Foreign Accrual Property Income (page does not exist)") rules to obviate certain types of tax avoidance. In the United Kingdom many provisions of the tax legislation (known as "anti-avoidance" provisions) apply to prevent tax avoidance where the main object (or purpose), or one of the main objects (or purposes), of a transaction is to enable tax advantages to be obtained.
In the United States, the [Internal Revenue Service](https://en.wikipedia.org/wiki/Internal_Revenue_Service "Internal Revenue Service") distinguishes some schemes as "abusive" and therefore illegal. The [Alternative Minimum Tax](https://en.wikipedia.org/wiki/Alternative_Minimum_Tax "Alternative Minimum Tax") was developed to reduce the impact of certain tax avoidance schemes. Furthermore, while tax avoidance is in principle legal, if the IRS in its sole judgment determines that tax avoidance is the 'principal purpose' for an expatriation attempt, 'covered expat' status will be applied to the requester, thereby forcing an expatriation tax on worldwide assets to be paid as a condition of expatriation.[\[87\]](https://en.wikipedia.org/wiki/Tax_avoidance#cite_note-87) The IRS presumes a principal purpose of tax avoidance if a taxpayer requesting expatriation has a net worth of \$622,000 or more, or has had more than \$124,000 in average annual net income tax over the 5 tax years ending before the date of expatriation.
In the UK, judicial doctrines to prevent tax avoidance began in *[IRC v Ramsay](https://en.wikipedia.org/wiki/The_Ramsay_Principle "The Ramsay Principle")* (1981) which decided that where a transaction has pre-arranged artificial steps that serve no commercial purpose other than to save tax, the proper approach is to tax the effect of the transaction as a whole. This is known as the Ramsay principle and this case was followed by *[Furniss v. Dawson](https://en.wikipedia.org/wiki/Furniss_v._Dawson "Furniss v. Dawson")* (1984) which extended the Ramsay principle. This approach has been rejected in most Commonwealth jurisdictions even in those where UK cases are generally regarded as persuasive. After two decades, there have been numerous decisions, with inconsistent approaches, and both the Revenue authorities and professional advisors remain quite unable to predict outcomes. For this reason this approach can be seen as a failure or at best only partly successful.
In the judiciary, different judges have taken different attitudes. As a generalisation, for example, judges in the United Kingdom before the 1970s regarded tax avoidance with neutrality; but nowadays they may regard aggressive tax avoidance with increasing hostility.
In the UK in 2004, the Labour government announced that it would use retrospective legislation to counteract some tax avoidance schemes, and it has subsequently done so on a few occasions, notably [BN66](https://en.wikipedia.org/wiki/BN66 "BN66"). Initiatives announced in 2010 suggest an increasing willingness on the part of HMRC to use retrospective action to counter avoidance schemes, even when no warning has been given.[\[88\]](https://en.wikipedia.org/wiki/Tax_avoidance#cite_note-88)
The UK Government has pushed the initiative led by the [Organisation for Economic Co-operation and Development](https://en.wikipedia.org/wiki/Organisation_for_Economic_Co-operation_and_Development "Organisation for Economic Co-operation and Development") (OECD) on base erosion and profit shifting.[\[89\]](https://en.wikipedia.org/wiki/Tax_avoidance#cite_note-89) In the 2015 Autumn Statement, Chancellor [George Osborne](https://en.wikipedia.org/wiki/George_Osborne "George Osborne") announced that £800m would be spent on tackling tax avoidance in order to recover £5 billion a year by 2019–20. In addition, large companies will now have to publish their UK tax strategies and any large businesses that persistently engage in aggressive tax planning will be subject to special measures.[\[90\]](https://en.wikipedia.org/wiki/Tax_avoidance#cite_note-90) With these policies, Osborne has claimed to be at the forefront of combating tax avoidance.[\[91\]](https://en.wikipedia.org/wiki/Tax_avoidance#cite_note-91) However, he has been criticised over his perceived inaction on enacting policies set forth by the OECD to combat tax avoidance.[\[32\]](https://en.wikipedia.org/wiki/Tax_avoidance#cite_note-PEye24/1/16-32)
In April 2015, the Chancellor George Osborne announced a tax on diverted profits, quickly nicknamed the "Google Tax" by the press, designed to discourage large companies moving profits out of the UK to avoid tax.[\[92\]](https://en.wikipedia.org/wiki/Tax_avoidance#cite_note-92) In 2016, Google agreed to pay back £130m of tax dating back to 2005 to HMRC, which said it was the "full tax due in law".[\[93\]](https://en.wikipedia.org/wiki/Tax_avoidance#cite_note-BBC_Google_Tax_2016-93) However, this amount of tax has been criticised by [Labour](https://en.wikipedia.org/wiki/Labour_Party_\(UK\) "Labour Party (UK)"), with ex Labour leader [Jeremy Corbyn](https://en.wikipedia.org/wiki/Jeremy_Corbyn "Jeremy Corbyn") saying that the rate of tax paid by Google only amounted to 3%.[\[93\]](https://en.wikipedia.org/wiki/Tax_avoidance#cite_note-BBC_Google_Tax_2016-93) Former [Liberal Democrat](https://en.wikipedia.org/wiki/Liberal_Democrats_\(UK\) "Liberal Democrats (UK)") Business Secretary [Vince Cable](https://en.wikipedia.org/wiki/Vince_Cable "Vince Cable") also said Google had "got off very, very lightly", and Osborne "made a fool of himself" by hailing the deal as a victory.[\[93\]](https://en.wikipedia.org/wiki/Tax_avoidance#cite_note-BBC_Google_Tax_2016-93) Although claiming that it was "absurd" to lay blame onto Google for tax avoidance, saying that [EU member states](https://en.wikipedia.org/wiki/EU_member_states "EU member states") should "\[compete\] with each other to offer firms the lowest corporate tax rates", Conservative MP [Boris Johnson](https://en.wikipedia.org/wiki/Boris_Johnson "Boris Johnson") said it was a "good thing" for corporations to pay more tax.[\[94\]](https://en.wikipedia.org/wiki/Tax_avoidance#cite_note-Independent_Johnson_Tax-94) However, Johnson said he did not want tax rates to go up or for European Union countries to do this in unison.[\[94\]](https://en.wikipedia.org/wiki/Tax_avoidance#cite_note-Independent_Johnson_Tax-94)
- [Estate planning](https://en.wikipedia.org/wiki/Estate_planning "Estate planning")
- [Fair Tax Town](https://en.wikipedia.org/wiki/Fair_Tax_Town "Fair Tax Town") movement
- *[Gregory v. Helvering](https://en.wikipedia.org/wiki/Gregory_v._Helvering "Gregory v. Helvering")*
- [Criticism of Apple Inc.\#Taxes](https://en.wikipedia.org/wiki/Criticism_of_Apple_Inc.#Taxes "Criticism of Apple Inc.")
- [Criticism of Google\#Tax avoidance](https://en.wikipedia.org/wiki/Criticism_of_Google#Tax_avoidance "Criticism of Google")
- [Corruption in Finland\#Tax avoidance](https://en.wikipedia.org/wiki/Corruption_in_Finland#Tax_avoidance "Corruption in Finland")
**General:**
- [Base erosion and profit shifting](https://en.wikipedia.org/wiki/Base_erosion_and_profit_shifting "Base erosion and profit shifting")
- [Capital flight](https://en.wikipedia.org/wiki/Capital_flight "Capital flight")
- [Carried interest](https://en.wikipedia.org/wiki/Carried_interest "Carried interest")
- [Conduit and Sink OFCs](https://en.wikipedia.org/wiki/Conduit_and_Sink_OFCs "Conduit and Sink OFCs")
- [Gaming the system](https://en.wikipedia.org/wiki/Gaming_the_system "Gaming the system")
- [Irish Section 110 SPVs](https://en.wikipedia.org/wiki/Irish_Section_110_Special_Purpose_Vehicle_\(SPV\) "Irish Section 110 Special Purpose Vehicle (SPV)")
- [List of foundations established in Vaduz](https://en.wikipedia.org/wiki/List_of_foundations_established_in_Vaduz "List of foundations established in Vaduz")
- [Tax exemption](https://en.wikipedia.org/wiki/Tax_exemption "Tax exemption")
- [Tax noncompliance](https://en.wikipedia.org/wiki/Tax_noncompliance "Tax noncompliance")
- [Luxembourg Leaks](https://en.wikipedia.org/wiki/Luxembourg_Leaks "Luxembourg Leaks")
- [Singapore Sling (tax avoidance)](https://en.wikipedia.org/wiki/Singapore_Sling_\(tax_avoidance\) "Singapore Sling (tax avoidance)")
- [Swiss Leaks](https://en.wikipedia.org/wiki/Swiss_Leaks "Swiss Leaks")
- [Panama Papers](https://en.wikipedia.org/wiki/Panama_Papers "Panama Papers")
- [Paradise Papers](https://en.wikipedia.org/wiki/Paradise_Papers "Paradise Papers")
- [Emmanuel Saez](https://en.wikipedia.org/wiki/Emmanuel_Saez "Emmanuel Saez") and [Gabriel Zucman](https://en.wikipedia.org/wiki/Gabriel_Zucman "Gabriel Zucman"). 2019. *The Triumph of Injustice: How the Rich Dodge Taxes and How to Make Them Pay*. W.W. Norton.
1. **[^](https://en.wikipedia.org/wiki/Tax_avoidance#cite_ref-1)**
Dyreng, Scott D.; Hanlon, Michelle; Maydew, Edward L. (2008). "Long-Run Corporate Tax Avoidance". *The Accounting Review*. **83**: 61–82\. [CiteSeerX](https://en.wikipedia.org/wiki/CiteSeerX_\(identifier\) "CiteSeerX (identifier)") [10\.1.1.638.2292](https://citeseerx.ist.psu.edu/viewdoc/summary?doi=10.1.1.638.2292). [doi](https://en.wikipedia.org/wiki/Doi_\(identifier\) "Doi (identifier)"):[10\.2308/accr.2008.83.1.61](https://doi.org/10.2308%2Faccr.2008.83.1.61).
2. **[^](https://en.wikipedia.org/wiki/Tax_avoidance#cite_ref-2)**
Back, Philippa Foster (23 April 2013). ["Avoiding tax may be legal, but can it ever be ethical?"](https://www.theguardian.com/sustainable-business/avoiding-tax-legal-but-ever-ethical). *The Guardian*. [ISSN](https://en.wikipedia.org/wiki/ISSN_\(identifier\) "ISSN (identifier)") [0261-3077](https://search.worldcat.org/issn/0261-3077). Retrieved 17 March 2016.
3. **[^](https://en.wikipedia.org/wiki/Tax_avoidance#cite_ref-3)**
["World Development Report 2019: The Changing Nature of Work"](https://www.worldbank.org/en/publication/wdr2019). *World Bank*. Retrieved 2022-08-02.
4. **[^](https://en.wikipedia.org/wiki/Tax_avoidance#cite_ref-4)** ["MPs publish report on Google's tax avoidance"](http://www.parliament.uk/business/committees/committees-a-z/commons-select/public-accounts-committee/news/tax-avoidance-google/). *UK Parliament*.
5. **[^](https://en.wikipedia.org/wiki/Tax_avoidance#cite_ref-5)** Jesse Drucker (21 October 2010). ["Google 2.4% Rate Shows How \$60 Billion Is Lost to Tax Loopholes"](https://www.bloomberg.com/news/articles/2010-10-21/google-2-4-rate-shows-how-60-billion-u-s-revenue-lost-to-tax-loopholes). *Bloomberg.com*.
6. **[^](https://en.wikipedia.org/wiki/Tax_avoidance#cite_ref-6)** [UK’s general anti-avoidance rule process on schedule](http://tmagazine.ey.com/insights/uks-general-anti-avoidance-rule-process-schedule/). *T Magazine*. [Archived](https://web.archive.org/web/20171020055343/http://www.ey.com/home) 20 October 2017 at the [Wayback Machine](https://en.wikipedia.org/wiki/Wayback_Machine "Wayback Machine")
7. ^ [***a***](https://en.wikipedia.org/wiki/Tax_avoidance#cite_ref-UKGAAR_7-0) [***b***](https://en.wikipedia.org/wiki/Tax_avoidance#cite_ref-UKGAAR_7-1)
["Tax avoidance: general anti-abuse rule guidance - latest version"](https://www.gov.uk/government/publications/tax-avoidance-general-anti-abuse-rules). *GOV.UK*. July 16, 2021.
8. **[^](https://en.wikipedia.org/wiki/Tax_avoidance#cite_ref-8)** For example, a Canadian organization describes Canada's law, first passed in 1988 in Section 245 of the Canada's federal income tax act (described [here](http://www.cra-arc.gc.ca/E/pub/tp/ic88-2/ic88-2-e.html)), as invalidating the tax consequences of a tax avoidance transaction if "not conducted for any primary purpose other than to obtain a tax benefit".
9. **[^](https://en.wikipedia.org/wiki/Tax_avoidance#cite_ref-9)**
["HM Revenue & Customs, Tempted by Tax Avoidance?"](https://www.gov.uk/government/uploads/system/uploads/attachment_data/file/372502/Tempted_by_Tax_Avoidance.pdf) (PDF). *GOV.UK*. Retrieved 6 April 2016.
10. **[^](https://en.wikipedia.org/wiki/Tax_avoidance#cite_ref-NYT01613_10-0)**
David Kocieniewski (6 January 2013). ["Major Companies Push the Limits of a Tax Break"](https://www.nytimes.com/2013/01/07/business/economy/companies-exploit-tax-break-for-asset-exchanges-trial-evidence-shows.html). *The New York Times*. Retrieved 7 January 2013. "With hundreds of thousands of transactions a year, it is hard to gauge the true cost of the tax break for so-called like-kind exchanges, like those used by Cendant, General Electric and Wells Fargo."
11. **[^](https://en.wikipedia.org/wiki/Tax_avoidance#cite_ref-11)**
Stiglitz, Joseph. ["The General Theory of Tax Avoidance"](https://www.nber.org/system/files/working_papers/w1868/w1868.pdf) (PDF). *National Bureau of Economic Research*. Retrieved 21 April 2021.
12. ^ [***a***](https://en.wikipedia.org/wiki/Tax_avoidance#cite_ref-Anti-Avoidance_Measures_12-0) [***b***](https://en.wikipedia.org/wiki/Tax_avoidance#cite_ref-Anti-Avoidance_Measures_12-1)
Ostwal, T.P.; Vijayaraghavan, Vikram (2010). ["Anti-Avoidance Measures"](https://www.jstor.org/stable/44283791). *National Law School of India Review*. **22** (2): 59–103\. [ISSN](https://en.wikipedia.org/wiki/ISSN_\(identifier\) "ISSN (identifier)") [0974-4894](https://search.worldcat.org/issn/0974-4894). [JSTOR](https://en.wikipedia.org/wiki/JSTOR_\(identifier\) "JSTOR (identifier)") [44283791](https://www.jstor.org/stable/44283791).
13. **[^](https://en.wikipedia.org/wiki/Tax_avoidance#cite_ref-13)**
Anonymous (13 September 2016). ["Anti Tax Avoidance Package"](https://ec.europa.eu/taxation_customs/business/company-tax/anti-tax-avoidance-package_en). *Taxation and Customs Union - European Commission*. Retrieved 26 April 2021.
14. **[^](https://en.wikipedia.org/wiki/Tax_avoidance#cite_ref-14)**
PricewaterhouseCoopers. ["ATAD (Anti-Tax Avoidance Directive)"](https://www.pwc.ch/en/services/tax-advice/corporate-taxes-tax-structures/atad.html). *PwC*. Retrieved 22 April 2021.
15. ^ [***a***](https://en.wikipedia.org/wiki/Tax_avoidance#cite_ref-Office_15-0) [***b***](https://en.wikipedia.org/wiki/Tax_avoidance#cite_ref-Office_15-1)
Office, Australian Taxation. ["A strong domestic tax regime"](https://www.ato.gov.au/general/tax-and-corporate-australia/a-strong-domestic-tax-regime/?default). *www.ato.gov.au*. Retrieved 21 April 2021.
16. ^ [***a***](https://en.wikipedia.org/wiki/Tax_avoidance#cite_ref-:0_16-0) [***b***](https://en.wikipedia.org/wiki/Tax_avoidance#cite_ref-:0_16-1)
Stiglitz; Rosengard, Joseph; Jay (2000). *Economics of the Public Sector*. W.W Norton & Company. pp. 709–743\.
`{{cite book}}`: CS1 maint: multiple names: authors list ([link](https://en.wikipedia.org/wiki/Category:CS1_maint:_multiple_names:_authors_list "Category:CS1 maint: multiple names: authors list"))
17. **[^](https://en.wikipedia.org/wiki/Tax_avoidance#cite_ref-17)** Moran Harari, Markus Meinzer and Richard Murphy (October 2012) ["Financial Secrecy, Banks and the Big 4 Firms of Accountants"](http://www.taxjustice.net/cms/upload/pdf/FSI2012_BanksBig4.pdf) [Archived](https://web.archive.org/web/20160407224017/http://www.taxjustice.net/cms/upload/pdf/FSI2012_BanksBig4.pdf) 7 April 2016 at the [Wayback Machine](https://en.wikipedia.org/wiki/Wayback_Machine "Wayback Machine") *Tax Justice Network*
18. **[^](https://en.wikipedia.org/wiki/Tax_avoidance#cite_ref-18)**
["The new refugees. (Americans who give up citizenship to save on taxes)"](https://web.archive.org/web/20060227051231/http://www.frissell.com/taxpat/FORBES1.HTM). *Forbes*. 21 November 1994. Archived from [the original](http://www.frissell.com/taxpat/FORBES1.HTM) on 27 February 2006. Retrieved 23 December 2006.
19. **[^](https://en.wikipedia.org/wiki/Tax_avoidance#cite_ref-19)** "[Foreign Earned Income Exclusion](https://www.irs.gov/individuals/international-taxpayers/foreign-earned-income-exclusion/)", [Internal Revenue Service](https://en.wikipedia.org/wiki/Internal_Revenue_Service "Internal Revenue Service"), [United States Department of the Treasury](https://en.wikipedia.org/wiki/United_States_Department_of_the_Treasury "United States Department of the Treasury").
20. **[^](https://en.wikipedia.org/wiki/Tax_avoidance#cite_ref-20)**
Panozzo, Chantal (18 February 2015). ["When American Expats Don't Want Their Kids to Have U.S. Citizenship"](https://blogs.wsj.com/expat/2015/02/18/when-american-expats-dont-want-their-kids-to-have-u-s-citizenship/). *Wall Street Journal*.
21. **[^](https://en.wikipedia.org/wiki/Tax_avoidance#cite_ref-21)** There are certain well-known exceptions to this: Cyprus has a heavily exploited double taxation relief treaty with Russia; another frequently used treaty is the double taxation relief treaty between Mauritius and India. There are also a number of other less well known and less frequently utilized treaties, such as the one between the British Virgin Islands and Switzerland.
22. **[^](https://en.wikipedia.org/wiki/Tax_avoidance#cite_ref-22)**
["Pasternak M., and Rico C., Tax Interpretation, Planning, and Avoidance: Some Linguistic Analysis, 23 Akron Tax Journal, 33 (2008)"](http://www.uakron.edu/law/lawreview/taxjournal/atj23/docs/Pasternak08.pdf) (PDF).
23. **[^](https://en.wikipedia.org/wiki/Tax_avoidance#cite_ref-23)**
["Fiduciary Trust"](https://www.fiduciarytrust.com/insights/article-detail/how-a-grat-can-help-you-reduce-estate-taxes). *www.fiduciarytrust.com*. Retrieved 2025-06-16.
24. **[^](https://en.wikipedia.org/wiki/Tax_avoidance#cite_ref-24)**
Elton, Edwin; Gruber, Martin (1968). ["The Effect of Share Repurchase on the Value of the Firm"](https://www.jstor.org/stable/2325314). *The Journal of Finance*. **23** (1): 135–149\. [doi](https://en.wikipedia.org/wiki/Doi_\(identifier\) "Doi (identifier)"):[10\.2307/2325314](https://doi.org/10.2307%2F2325314). [ISSN](https://en.wikipedia.org/wiki/ISSN_\(identifier\) "ISSN (identifier)") [0022-1082](https://search.worldcat.org/issn/0022-1082). [JSTOR](https://en.wikipedia.org/wiki/JSTOR_\(identifier\) "JSTOR (identifier)") [2325314](https://www.jstor.org/stable/2325314).
25. ^ [***a***](https://en.wikipedia.org/wiki/Tax_avoidance#cite_ref-:12_25-0) [***b***](https://en.wikipedia.org/wiki/Tax_avoidance#cite_ref-:12_25-1)
Tèrslèv, Thomas; Wier, Ludvig; Zucman, Gabriel (2022). ["The Missing Profits of Nations"](https://doi.org/10.1093/restud/rdac049). *The Review of Economic Studies*. **90** (3): 1499–1534\. [doi](https://en.wikipedia.org/wiki/Doi_\(identifier\) "Doi (identifier)"):[10\.1093/restud/rdac049](https://doi.org/10.1093%2Frestud%2Frdac049). [ISSN](https://en.wikipedia.org/wiki/ISSN_\(identifier\) "ISSN (identifier)") [0034-6527](https://search.worldcat.org/issn/0034-6527).
26. ^ [***a***](https://en.wikipedia.org/wiki/Tax_avoidance#cite_ref-HMRCtaxgap_26-0) [***b***](https://en.wikipedia.org/wiki/Tax_avoidance#cite_ref-HMRCtaxgap_26-1)
["Measuring tax gaps 2018 edition"](https://assets.publishing.service.gov.uk/government/uploads/system/uploads/attachment_data/file/715742/HMRC-measuring-tax-gaps-2018.pdf) (PDF).
27. **[^](https://en.wikipedia.org/wiki/Tax_avoidance#cite_ref-27)**
["New estimates reveal the extent of tax avoidance by multinationals"](http://www.taxjustice.net/2017/03/22/new-estimates-tax-avoidance-multinationals/). 22 March 2017.
28. **[^](https://en.wikipedia.org/wiki/Tax_avoidance#cite_ref-28)**
["TJN Profit Shifting Tax Loss Estimates"](https://docs.google.com/spreadsheets/d/1r7jdXvQ1NaGjUUkH1afniE3xvTyCu7NC8BZWZjkkQ-k/edit?usp=sharing&usp=embed_facebook). *Google Docs*.
29. ^ [***a***](https://en.wikipedia.org/wiki/Tax_avoidance#cite_ref-leigh_29-0) [***b***](https://en.wikipedia.org/wiki/Tax_avoidance#cite_ref-leigh_29-1)
David Leigh (14 June 2008). ["Government outlaws tax avoidance schemes"](https://www.theguardian.com/business/2008/jun/14/taxavoidance.tesco). *The Guardian*. UK.
30. **[^](https://en.wikipedia.org/wiki/Tax_avoidance#cite_ref-30)**
Murphy, Richard. ["Tesco: tax avoiding, again (this time it's Luxembourg)"](https://www.taxresearch.org.uk/Blog/2008/06/11/tesco-tax-avoiding-again-this-time-its-luxembourg/). *Funding the Future*.
31. **[^](https://en.wikipedia.org/wiki/Tax_avoidance#cite_ref-31)**
Lawrence, Felicity (11 October 2011). ["Quarter of FTSE 100 subsidiaries located in tax havens"](https://www.theguardian.com/business/2011/oct/11/ftse-100-subsidiaries-tax-havens?newsfeed=true). *The Guardian*. London.
32. ^ [***a***](https://en.wikipedia.org/wiki/Tax_avoidance#cite_ref-PEye24/1/16_32-0) [***b***](https://en.wikipedia.org/wiki/Tax_avoidance#cite_ref-PEye24/1/16_32-1) [***c***](https://en.wikipedia.org/wiki/Tax_avoidance#cite_ref-PEye24/1/16_32-2)
["Why multinationals love Generous George"](https://web.archive.org/web/20160124020802/http://www.private-eye.co.uk/issue-1410/in-the-back). *Private Eye*. No. 1410. 24 January 2016. Archived from [the original](http://www.private-eye.co.uk/in-the-back) on 24 January 2016. Retrieved 24 January 2016.
33. **[^](https://en.wikipedia.org/wiki/Tax_avoidance#cite_ref-33)** Rajeev Syal. ["MPs attack Amazon, Google and Starbucks over tax avoidance"](https://www.theguardian.com/business/2012/dec/03/amazon-google-starbucks-tax-avoidance). *The Guardian*.
34. **[^](https://en.wikipedia.org/wiki/Tax_avoidance#cite_ref-34)** Rajeev Syal. ["Amazon, Google and Starbucks accused of diverting UK profits"](https://www.theguardian.com/business/2012/nov/12/amazon-google-starbucks-diverting-uk-profits). *The Guardian*.
35. **[^](https://en.wikipedia.org/wiki/Tax_avoidance#cite_ref-35)** Juliette Garside. ["Amazon UK boycott urged after retailer pays just £4.2m in tax"](https://www.theguardian.com/business/2014/may/09/margaret-hodge-urges-boycott-amazon-uk-tax-starbucks). *The Guardian*.
36. **[^](https://en.wikipedia.org/wiki/Tax_avoidance#cite_ref-36)**
["Starbucks suffers first ever drop in UK sales after tax criticism"](https://www.irishtimes.com/business/retail-and-services/starbucks-suffers-first-ever-drop-in-uk-sales-after-tax-criticism-1.1772574). *Irish Times*. 24 April 2014. Retrieved 8 September 2020.
37. **[^](https://en.wikipedia.org/wiki/Tax_avoidance#cite_ref-37)**
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87. **[^](https://en.wikipedia.org/wiki/Tax_avoidance#cite_ref-87)**
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88. **[^](https://en.wikipedia.org/wiki/Tax_avoidance#cite_ref-88)** [HMRC goes on £1bn retro warpath](http://www.accountancyage.com/accountancyage/news/2258065/hmrc-goes-1bn-retro-warpath) [Archived](https://web.archive.org/web/20100221181537/http://www.accountancyage.com/accountancyage/news/2258065/hmrc-goes-1bn-retro-warpath) 21 February 2010 at the [Wayback Machine](https://en.wikipedia.org/wiki/Wayback_Machine "Wayback Machine"), *[Accountancy Age](https://en.wikipedia.org/wiki/Accountancy_Age "Accountancy Age")*, 18 February 2010
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Szu Ping Chan (9 October 2015). ["Taxes must be paid, says George Osborne, as he backs crackdown on havens"](https://www.telegraph.co.uk/finance/economics/11923216/Taxes-must-be-paid-says-George-Osborne-as-he-unveils-crackdown-on-havens.html). *The Daily Telegraph*. Lima. [Archived](https://ghostarchive.org/archive/20220112/https://www.telegraph.co.uk/finance/economics/11923216/Taxes-must-be-paid-says-George-Osborne-as-he-unveils-crackdown-on-havens.html) from the original on 2022-01-12. Retrieved 24 January 2016. "George Osborne has warned that companies which dodge tax will face the full force of the law, as he pledged to implement new rules designed to close international loopholes and end tax havens."
92. **[^](https://en.wikipedia.org/wiki/Tax_avoidance#cite_ref-92)**
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93. ^ [***a***](https://en.wikipedia.org/wiki/Tax_avoidance#cite_ref-BBC_Google_Tax_2016_93-0) [***b***](https://en.wikipedia.org/wiki/Tax_avoidance#cite_ref-BBC_Google_Tax_2016_93-1) [***c***](https://en.wikipedia.org/wiki/Tax_avoidance#cite_ref-BBC_Google_Tax_2016_93-2)
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94. ^ [***a***](https://en.wikipedia.org/wiki/Tax_avoidance#cite_ref-Independent_Johnson_Tax_94-0) [***b***](https://en.wikipedia.org/wiki/Tax_avoidance#cite_ref-Independent_Johnson_Tax_94-1)
Stone, Jon (26 January 2016). ["It is 'absurd' to blame Google for not paying their taxes, Boris Johnson says"](https://www.independent.co.uk/news/uk/politics/it-is-absurd-to-blame-google-for-not-paying-their-taxes-boris-johnson-says-a6832361.html). *The Independent*. [Archived](https://ghostarchive.org/archive/20220526/https://www.independent.co.uk/news/uk/politics/it-is-absurd-to-blame-google-for-not-paying-their-taxes-boris-johnson-says-a6832361.html) from the original on 2022-05-26. Retrieved 27 January 2016.
- [Tax Avoidance](https://www.theguardian.com/business/taxavoidance) collected news and commentary at *[The Guardian](https://en.wikipedia.org/wiki/The_Guardian "The Guardian")* [](https://www.wikidata.org/wiki/Q329303#P3106 "Edit this at Wikidata")
- [Fact File: Tax Avoidance](https://www.independent.co.uk/news/factfiles/fact-file-tax-avoidance-7873011.html), *[The Independent](https://en.wikipedia.org/wiki/The_Independent "The Independent")* |
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