ABSTRACT
Paying taxes is one of the most fundamental ways in which corporate citizens engage with broader society; tax revenues are the lifeblood of the social contract vital to liberty and the market economy. This chapter considers: acknowledgement of the role of corporate social responsibility expenditure in tax policy, tax avoidance as a norm and the implications of tax avoidance in relation to responsible business practices. A number of tax avoidance mechanisms are widely known and used, such as transfer pricing, re-invoicing, offshore special-purpose vehicles, corporate inversions, dubious charitable trusts and other vehicles for tax abuse. Tax avoidance enables companies to be economic free-riders, enjoying the benefits of corporate citizenship without accepting the costs, in the process causing harmful market distortions and shifting a larger share of the tax burden onto other taxpayers who do not have the luxury of exploiting avoidance mechanisms.
