Southern Voice’s network member Neeti Biyani of Centre for Budget and Governance Accountability (CBGA) writes about India’s Transparency Reforms to Curb Illicit Financial Flows. The blog is part of the “SDG Solutions” series hosted by the UN Foundation, Global Daily, and +SocialGood to raise awareness of ways the international community can advance, and is advancing, progress on the Sustainable Development Goals.
Domestic resource mobilization is crucial for a state to finance development, provide social security and redistribute wealth. The Sustainable Development Goals (SDGs) regard domestic revenue as fundamental for countries to meet their developmental goals. However, the shadow financial system is increasingly limiting the ability of governments to raise revenue on their own. Whether it is through anonymous companies or because of limited capacity of national tax authorities, illicit financial flows (IFFs) have explicit detrimental effects on financing of sustainable development.
IFFs are funds that are illegally earned, transferred and/or utilized. The majority of all IFFs however, result from cross-border tax-related transactions that exploit legal loopholes, including tax avoidance schemes. Developing countries lost $1.1 trillion to IFFs in 2013 alone, and $7.85 trillion between 2004 and 2013. On the other hand, net official development assistance from countries of…. Read more
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