Multinational companies avoid the burden of tax payment by taking advantage of loopholes in laws, according to a report released yesterday.

The report - Getting to Good: Towards Responsible Corporate Tax Behaviour - called for curbing tax avoidance in developing countries like Bangladesh and expanding the tax net to finance development. ActionAid, Christian Aid and Oxfam jointly launched the report at the capital's Rigs Inn.

At the programme, the discussants said a good culture of tax payment has not been created among multinational firms because of old laws and rules, various agreements and a lack of transparency and accountability.

As a result, the tax to gross domestic product ratio remains at 11 percent, although it should be 16 percent.

Citing data, such as Bangladesh's infant mortality rate of 33 percent and secondary education ratio of 37.8 percent of population, the report said financing is a fundamental factor in addressing these concerns.

Subsequently, it is essential to curb corporate tax evasion in developing countries like Bangladesh. The developing countries rely more on corporate taxes because of a lack of income resources, it said.

Referring to the International Monetary Fund, it said the proportion of total tax revenue raised from corporate income taxes is 8 percent in developed countries and 16 percent in developing countries.

Ewan Livingston, senior advocacy adviser of ActionAid UK, said new sources of domestic tax revenue are needed.

"The need to tackle corporate tax avoidance is inseparable from the wider development goals," he added.

Subsequently, the discussants suggested plugging the loopholes in laws. Some suggested the government negotiate with other countries to come up with double taxation avoidance agreements in favour of Bangladesh.

The multinational companies take out their profits, saying that they pay taxes on their income elsewhere, said Farah Kabir, ActionAid's country director for Bangladesh. "This affects countries like Bangladesh.”

At the programme, MA Mannan, state minister for finance, and Muhammad Abdul Mazid, a former chairman of the National Board of Revenue, also spoke.