Illicit financial flows from developing countries, which can among other things be attributed to tax evasion or aggressive (and “dishonest”) tax avoidance practices, are estimated to have totalled USD 641-979 billion in 2006. As the world's largest offshore asset management location, Switzerland bears a special responsibility in this respect. This responsibility derives not least from the Swiss Federal Constitution and from Switzerland's participation in the international human rights system. Switzerland's international tax policy has accordingly drawn scrutiny from the international community. Developing countries are also becoming increasingly aware of this issue. The project explores the potential of the international tax system from a developing country perspective. An international tax system that is approaching developing countries should be able to effectively prevent double taxation, create good framework conditions for investments, ensure and guarantee just distribution of tax income and ensure that no tax substrate is removed from taxation. The research shows that the present double taxation agreement (DTA) networks can only partially meet these goals, however; they have gaps and are easily abused. This project, which is partly financed by the Swiss Development and Cooperation Agency, explores linkages and shows ways of how to better balance diverging interests.
