Member News
By Gurpreet Brar - 11th November 2009
Corporations who avoid paying tax should be treated the same way as benefit cheats, a meeting at the Commons was told earlier this week.
Gillian Tett, deputy editor of the Financial Times, chaired the all party parliamentary group on debt, aid and relief event on behalf of Action Aid.
She began with to a billboard at Heathrow airport that recently caught her attention:
"We have ways of tracking benefit cheats," it said.
Tett asked whether there should be a similar system in place for corporations and large businesses who are evading taxes.
The financial crisis has precipitated an intense interest in tax havens among governments across the world as they seek to recoup vital revenue.
Speaking at the event, the recently-appointed South African finance minister, Pravin Gordham, slammed the 'catch me if you can' attitude of multinational companies.
He called for greater skill sharing, standardisation of international documents and the exchange of tax information to enable revenue authorities to better trace tax dodging.
Stephen Timms, financial secretary to the Treasury, echoed Pravin's call for greater transparency.
He drew their attention to a recent G20 communiqué where greater cooperation on tax evasion was agreed.
Timms said the OECD is carrying out a study into the feasibility of country-by-country reporting.
Speaking after the event, Dorcas Erskine from ActionAid said:
"We are already seeing how budgets are being squeezed in poor countries as a result of the global financial crisis.
"As Mr Gordhan stressed, it is all the more important that developing countries are able to raise the revenue they are entitled too.
"ActionAid agrees with the minister on the need for developing countries to develop their own revenue base as a means of promoting long term, sustainable financing for development, and ultimately better governance and responsibility to their own citizens.
"It is therefore crucial that the G20 keep their promise to ensure any action on tax havens also benefits developing countries."
Dods Parliamentary Communications Ltd