Tackling tax abuse through company ownership transparency

Globally, countries lose an estimated USD 492 billion a year to tax abuse.

Shell companies with complex and opaque ownership structures are one of the key tools that wealthy individuals and multinational companies use to avoid and evade tax.

Our new report sets out how tax authorities can use company ownership information to help tackle tax abuse, and raise more revenue to invest in public services, finance the green transition or pay down government debt.

Company ownership transparency: opportunities for tax authorities

Over the last decade, governments have made significant progress to tackle the abuse of shell companies by creating registers of who really owns, controls and benefits from companies and other legal vehicles. Now nearly 100 countries have introduced beneficial ownership registers.

As a global not-for-profit, Open Ownership provides technical support to governments to help them collect, verify and share data about the real owners of companies. We also produce new research and evidence, and work with global policy makers to advocate for effective reforms.

Tax authorities have used beneficial ownership information for a long time, however, most don’t yet use it proactively and systematically. For example, many tax authorities don’t properly integrate data from beneficial ownership registers around the world with data they hold on domestic taxpayers - which would give them a much clearer picture of who owns what.

Tackle tax abuse

Tackle tax abuse by identifying potential risks of avoidance, evasion and other forms of non-compliance, and carrying out investigations. Tax authorities should focus on understanding taxable assets, taxable income, transactions and the transfer of assets, and the use of legal vehicles in criminal attacks on the tax system.

Inform tax policy

Beneficial ownership data can be used to conduct analysis and develop insights which support the development of effective tax policies and reforms. For example, helping to establish the potential impact of a wealth tax.

Strengthen tax integrity

Strengthen tax integrity and deliver other co-benefits. This includes taking a whole of government approach to tackling money laundering, criminal gangs and tax crime, and helping the government and private sector meet international obligations such as to exchange tax information and know your customer.