The UK government is to provide £6m of funding for projects to help developing countries increase their tax revenues and combat tax evasion and avoidance, in line with commitments made at the G8 summit earlier this year in Lough Erne.

The Treasury said the funding is designed to help stem the tide of tax base erosion and profit shifting and the initiatives could result in revenues in some of the world's poorest regions rising by up to £100m over the next four years.

Exchequer Secretary to the Treasury, David Gauke said: 'At the G8 we committed to increasing our support for developing countries so that they can collect the taxes that are owed. This commitment shows that the UK is leading the way in providing support to developing country tax authorities.'

The funding will go to establishing an OECD database of expert tax inspectors who can be deployed to developing countries to advise on complex audits, and on work to explore how developing countries can participate in the international exchange of tax information.

Other projects will provide expert advice on adopting and implementing transfer pricing rules, with the Treasury reporting that pilots of this project have seen a 76% increase in revenues from multinationals in Colombia and an additional £14.8m of revenue in Kenya.

The funding announcement follows the government's announcement in March of a new capacity building unit, based in HMRC and funded by DFID, which will work in partnership with developing countries to strengthen their tax administrations. The unit will run programmes in Tanzania, Ethiopia Pakistan and in Southern Africa.