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11 Apr 2016

Clár Ní Chonghaile, in The Guardian (UK)

Activists call for reforms to curb tax evasion by multinationals that rob African countries of resources that could fund education & healthcare

"'A system of privilege and benefits': is a global tax body needed?"

The Panama Papers have pulled back the curtain, revealing how tax wizards push and pull the levers of the global system to benefit elites. The fact that tax havens and offshore accounts are used by powerful individuals and corporations to wriggle out of tax obligations is no surprise; some developing countries and activists have long called for reforms, and their fight is gaining momentum...

The OECD, sometimes described as the rich countries’ club, has embarked on a two-year reform process to combat aggressive tax avoidance, particularly by multinationals that exploit differentials to move money across borders...Savior Mwambwa, the head of ActionAid’s international tax campaign, describes the OECD move as “tinkering at the edges of a huge injustice”. He argues that while it might be based on a genuine desire for inclusiveness, it does not go far enough. “It still doesn’t touch the core of global international governance in terms of who really is involved in making the rules,” says Mwambwa, noting that most wealthier countries would rather others moved first than be trendsetters themselves...

In poor countries, corporate taxes can fund education and healthcare, pay for roads and railways and increase gender equality.