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Press Release, July 27, 2001

For Immediate Release
Friday, July 27, 2001
202-285-0244
www.freedomandprosperity.org

New Study Exposes Fraudulent Oxfam Calculation

Washington, DC According to a new study released today by the Center for Freedom and Prosperity Foundation (CFPF), Oxfam's assertion that so-called tax havens deprive developing nations of $50 billion per year in tax revenue is completely baseless. Entitled "Oxfam's Shoddy Attack on Low-Tax Jurisdictions," the new report shows that the U.K.-based charity allowed ideology to dictate results.

Andrew Quinlan, president of the Center for Freedom and Prosperity Foundation, said of the study, "I hope that this new analysis will undermine the OECD's divide-and-conquer strategy against the developing world. Simply stated, the Oxfam assertion that developing nations are losing $50 billion of tax revenue each year is based on completely phony numbers. I am sure that Dan Mitchell's research and analysis once-and-for-all dispels this myth."

The following is the executive summary of the study:

"Oxfam, a U.K.-based charity, published a study last year claiming that so-called tax havens deprive developing nations of $50 billion of tax revenue each year. Supporters of the anti-tax competition initiative of the Organization for Economic Cooperation and Development (OECD) frequently cite this figure in hopes of creating a schism among developing nations. Yet the study is grossly flawed, which explains why even the OECD refuses to endorse its methodology. A large share of supposed foregone revenue - 70 percent, or $35 billion - comes from a calculation of multinational tax revenues in which Oxfam makes up figures for both corporate profits and corporate tax rates. Foregone taxes on individual savings are claimed to "cost" governments about $15 billion, but this figure also is based on make-believe tax rates. At no point does Oxfam recognize the pro-growth impact of lower tax rates."

[August 2001, Prosperitas, Oxfam's Shoddy Attack on Low-Tax Jurisdictions, by Daniel J. Mitchell of the Heritage Foundation]

Link to full Study:
http://www.freedomandprosperity.org/Papers/oxfam/oxfam.shtml

Note: Center for Freedom and Prosperity Foundation is the research and educational affiliate of the Center for Freedom and Prosperity (CFP). This new CFPF publication entitled Prosperitas, which is Latin for "prosperity" will be published periodically with new studies on issues dealing with tax competition, financial privacy, and fiscal sovereignty.

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