Corruption is rife, but authorities aren’t far behind

26th January 2017

Global tax fraud is driving up suspicions of corruption, if the latest report from Transparency International is to be believed. According to the watchdog’s 2016 Corruption Perceptions Index – which gives a lower score for countries which are seen as more corrupt – there were more falling scores than rising ones when compared to 2015.

The impact of corruption

In response to this latest information, Transparency International suggested the decline in positive perceptions was largely a result of public-sector corruption, singling out the Panama Paper scandal as a significant event which led to a general feeling of anger towards individuals and companies involved in tax fraud.

Indeed, as the watchdog explained: “It is still far too easy for the rich and powerful to exploit the opaqueness of the global financial system to enrich themselves at the expense of the public good.”

So which countries have fallen down the scale and which are now viewed as the least corrupt?

  • Denmark, New Zealand, Finland and Sweden remained at the top of the list, maintaining their reputation as the least corrupt locations.
  • The UK also remained stable, hanging on to tenth position.
  • Qatar was one of the unluckier countries, losing ten points following the 2022 Fifa World Cup bidding scandal, putting it at 31st position on the board.
  • For the tenth consecutive year, Somalia remained in last place in the rankings.
  • The US also lost points, putting it 18th on the list. While there was no mention of the election of Donald Trump as President towards the end of last year in the report itself, Transparency International did release a separate statement that alluded to the ‘conflicts of interest’ in Trump’s new government appointments that will likely impact next years’ results.

However, while there has clearly been a dip in the perceptions of countries as more examples of corruption come to light, it can’t be forgotten that authorities around the world are increasingly seeking out new ways to tackle foul play. In fact, on the back of the report, Transparency International called on global governments to do more to tackle corruption, including ‘deep-rooted systematic reforms’ and harsher punishments for what the watchdog referred to as ‘professional enablers of tax evasion and fraud’.

It can only be assumed, then, that wrong-doers will face the full wrath of the law if found to be evading relevant payments in their chosen location, regardless of the perceived level of corruption in that country. For agencies placing contractors abroad, it’s now more important than ever to ensure individuals are tax compliant, or face the repercussions.

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