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 London, Jul 23 (PTI): A new report by tax researchers estimates black money deposited by a “global super-rich elite” in offshore accounts at £13 trillion (Rs 110,000,000 crore), equivalent of the combined GDP of the US and Japan.
The report by Tax Justice Network released to The Observer is said to be the “most detailed estimates yet of the size of the offshore economy.”
In an appendix, the report says that “(it) first became evident in the late 1980s that a vast amount of flight capital was pouring out of the developing world.” The report suggests that for many developing countries the cumulative value of the capital that has flowed out of their economies since the 1970s would be more than enough to pay off their debts to the rest of the world.
James Henry, former chief economist at consultancy McKinsey and an expert on tax havens, shows that £13-15 trillion had leaked out of scores of countries into secretive locations such as Switzerland and the Cayman Islands, with the help of private banks.
Their wealth is “protected by a highly paid, industrious bevy of professional enablers in the private banking, legal, accounting and investment industries taking advantage of the increasingly borderless, frictionless global economy”.
According to research, the top 10 private banks, which include UBS and Credit Suisse in Switzerland, as well as the US investment bank Goldman Sachs, managed more than 4 trillion pounds in 2010, a sharp rise from £1.5 trillion five years earlier.
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