than taxing income or profit. Governments worldwide are looking to raise more of their taxes from indirect taxes, which from a business perspective should be more neutral than direct taxes."29 The result of such pressures is that we have fiscal policies that, instead of shifting more of the tax burden on to the wealthiest corporations and the richest individuals, as both economic common sense and human rights would require, end up taxing wage earners and consumers through VAT and the imposition of users' fees in sectors such as health or education. According to calculations of the World Bank, the average total tax rate payable by businesses on their commercial profits decreased from 53.5 % to 40.8 % between 2005 and 2015.30 Although some countries moved in the opposite direction (Argentina and Chile are examples in Latin America ; Malaysia and Niger provide illustrations in Asia and in Africa), the trend downwards is massive: for many countries, the reduction of corporate taxes is measured in double digits. On average, the total tax rates in the Euro Area countries went from 51.0 % to 43.6 %, a trend corresponding roughly to the tendency in the European Union as a whole. But the phenomenon is especially spectacular in the countries classified by the UN as least-developed, where the rate went down on average from 75.4 % to 44.7 %; if we consider heavily indebted poor countries alone, the decrease is from 81.2 % to 52.7 %. 4. Effectively combating tax evasion and illicit financial flows The fight against tax evasion is the third channel through which tax policies can be made to contribute better to the realization of economic, social and cultural rights. Tax evasion represents a huge loss to countries, and it is of particular consequence (as a percentage of their public budgets) in low- and middle-income countries.31 In 2008, Global Financial Integrity estimated that, during the 2002-2006 period, illicit financial flows represented an average of between 859 billion and 1.06 trillion USD on a yearly basis.32 For Africa alone, a conservative estimate is that illicit financial flows have amounted to a total of 854 billion USD for the period 1970-2008.33 These outflows have been steadily growing throughout the period at an average rate of 12.1 percent per year (with peaks reached in oil-producing countries such as Nigeria and Soudan linked to increases in the price of oil). The impacts are considerable: by the end of 2008, the same study notes, the cumulative impact of these outflows meant that each African woman, man or child lost 989 USD to illicit financial outflows.34 In fact, the total financial flows for 1970-2008 represents a sum far in excess of the external debt of all African countries (279 billion USD in 2008): in other terms, taking into account illicit financial flows, Africa is a net creditor to the world, and by tackling such illicit financial flows, about 600 billion USD could have been mobilized for the fight against poverty on the continent.35 60 to 65 percent of the total illicit financial flows come from commercial tax evasion, which results from overpricing imports and underpricing exports on customs documents, and thereby illegally transferring money abroad. Alhough the situation in Africa is particularly troubling, the continent is not alone in this regard. For instance, according to the 29 World Bank and PwC, Paying Taxes 2017: The Global Picture, cited above, at 82. This is a non-weighted average: small economies count as much as large ones in the calculation of the average. The total tax rate, for the purpose of this calculation, is the "amount of taxes and mandatory contributions payable by businesses after accounting for allowable deductions and exemptions as a share of commercial profits". For more details, see http://data.worldbank.org/indicator/IC.TAX.TOTL.CP.ZS?end=2015&start=2005&view=chart (last consulted on September 9th, 2016). Some countries have lowered corporate taxes faster than others: during this ten-year period, Albania lowered corporate taxes from 58.2 % to 36.5 %, Belarus from 137.3 % to 51.8 %, and Uzbekistan from 96.7 % to 41.1 %; Canada went from 47.5 % to 21.1 %, and Paraguay from 54.5 % to 35.0 %. Turkey moved from 52.8 % to 40.9 %. 31 For a useful assessment, see OECD, Development Co-Operation Report 2014. Mobilising Resources for Sustainable Development, cited above note 11, chapter II.13. 32 Dev Kar and Devon Cartwright-Smith, Illicit Financial Flows from Developing Countries: 2002-2006 (Global Financial Integrity, Washington DC, Dec. 2008). 33 Dev Kar and Devon Cartwright-Smith, Illicit Financial Flows from Africa: Hidden Resource for Development (Global Financial Integrity, Washington DC, 2010). 34 Dev Kar and Devon Cartwright-Smith, Illicit Financial Flows from Africa: Hidden Resource for Development, cited above, at 12. 35 This was also the conclusion reached by Ndikumana, Léonce and James K. Boyce, New Estimates of Capital Flight from Sub-Saharan African Countries: Linkages with External Borrowing and Policy Options (University of Massachusetts, Amherst, April 2008). 30 12 CRIDHO Working Paper 2017/1