Tax avoidance exists because globalization makes room for multinationals to be more powerful and influential in policy formation favouring their sectors. They dig deeper into tax loopholes of trading countries to take advantage of the opportunity that allows them to avoid tax. As soon as some global monitoring authority is set up, without any influence of rich nations, tax avoidance cases will soon be unearthed. Meanwhile, other methods like stringent measures, amending domestic tax laws, making elaborated declaration mandatory, and using tax shaming by authorities and citizens must continue to press multinationals to come in line with their tax responsibilities.
An international tax monitoring system that is autonomous and contains one member each representing a country, is a necessity to be dedicated only to search for tax avoidance cases, identify them, report them, punish them and eventually penalise them. I think an autonomous body with the most ethical and moral personnel could be of significant use to identify the cases of tax avoidance and impose stringent adherence to its rules and laws. Moreover, cross-country taxable laws are to be amended completely to give rise to a new order of fair taxation, irrespective of the relationship obligations so that the rich countries cannot exploit the poor.
Most of all, realisation of tax avoidance as a growing parasite by the global community and overhauling all tax laws is an immediate necessity. The host country and the multinational’s country of origin must come together to amend tax laws to give rise to a simple yet effective structure that eradicates tax avoidance possibilities.