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Financial Transparency Coalition Meets in Africa on Problem of Illicit Financial Flows September 30th, 2013
The new Financial Transparency Coalition is meeting in Dar es Salaam, Tanzania on October 1-2. The theme for the conference, is “Towards Transparency: Making the Global Financial System Work for Development.” Fr. Seamus Finn, OMI, US JPIC Office Director, is officially representing ICCR (Interfaith Center on Corporate Responsibility) at the conference.
Nearly a trillion dollars a year has been secreted out of developing countries, robbing them of revenue needed desperately for development. The coalition was formed to do something about this problem that is central to the development of poor countries. According to the Coalition, half of the illicit financial flows – a staggering $500 billion – is coming from Africa. Flowing from crime, corruption, and tax evasion, these illicit transfers represent a drain on developing economies that is equivalent to eight times the size of global foreign aid.
The US JPIC Office is involved in several inter-connected organizations in Washington, DC, working for greater financial justice and transparency. These include the Tax Justice Network USA, (where Fr. Finn serves on the Board), and the FACT coalition (Financial Accountability and Corporate Transparency Campaign). The international Financial Transparency Coalition was launched in May of 2013, in response to the growing awareness and activism around the problem of illicit financial flows.
Ahead of the G8 Summit, the European Parliament adopted new transparency rules to require oil, gas, mining and logging companies to declare corporate payments to governments in countries where they operate – much like the Dodd-Frank Act Section 1504. At the G8 summit, leaders of the wealthiest nations are to consider reporting requirements for all multinational corporate payments made to governments. This kind of “country-by-country” reporting of profits and taxes can stem corporate tax avoidance to both poor and wealthy nations.
Eric LeCompte, Executive Director of Jubilee USA Network, a faith-based antipoverty organization, released the following statement:
“Hats off to the European Union for promoting transparency and corporate accountability. Let’s hope it inspires ministers at the upcoming G8 meetings to curb corporate tax avoidance and promote transparency for all multinationals.
“The faith community believes that corporate tax avoidance constitutes a theft from the world’s poorest and most vulnerable people. When the G8 addresses this issue in Northern Ireland, they can have a real impact on global poverty.
“It’s clear that the G8 host, UK Prime Minister David Cameron, wants multinational corporate tax avoidance to be addressed. Hopefully he’ll take the energy from the EU to the G8. We’ve got to act as every year poor countries lose more to tax dodging than they receive in aid.”
Tax avoidance to be on agenda of 17-18 June G8 Summit June 12th, 2013
Senior Catholic bishops from all of the G8 countries urged G8 Ministers to tackle tax avoidance, saying that “paying a fair share of taxes” is a “moral obligation”. Cardinal Brady, the head of Ireland’s Catholic church organized a letter to the G8, urging leaders to make good on their pledge to tackle aggressive tax avoidance at a summit later this month.
Last month, US senators described Ireland as a “tax haven”, accusing it of facilitating a multibillion-dollar tax avoidance structure for Apple. Tax Justice campaigners have argued that Ireland’s ultra-low corporation tax rate of 12.5%, combined with a series of additional tax incentives, is having a corrosive impact on tax coffers elsewhere, particularly poorer nations.
“In terms of tackling hunger, nothing is more crucial…than tax justice”, says Oliver De Schutter, UN Special Rapporteur on the Right to Food.
The Tanzania Energy and Minerals Minister says multinationals’ tax evasion and avoidance by companies and others is “crippling development and negatively affecting government budgets to cover…health, education and food production.” Many multinational companies operating in Tanzania are alleged to have accounts in British Virgin Islands, Cayman Islands, Bermuda and several other places under Britain to avoid paying taxes.
The Oblates belong to a coalition of non-governmental and faith groups – Tax Justice Network – that is campaigning for a more just international tax system.
First Step to Avoid the Fiscal Cliff: Close Offshore Tax Loopholes December 6th, 2012Offshore Tax Dodging Costs U.S. $150 Billion Annually; U.S. PIRG Illustrates Impact with 16 Dramatic Ways Lost Revenue Could Be Used
With Congress scrambling to agree on ways to reduce the deficit, U.S. Public Interest Research Group (U.S. PIRG) released a new analysis pointing out a clear first step to avoid the “fiscal cliff”: closing offshore tax loopholes. Many of America’s largest corporations and wealthiest individuals use accounting gimmicks to shift profits made in America to offshore tax havens, where they pay little to no taxes. This tax avoidance costs the federal government an estimated $150 billion in tax revenue each year. U.S. PIRG’s new data illustrates the size of this loss with 16 dramatic ways $150 billion could be spent.
“When corporations skip out on their taxes, the rest of us are left to pick up their tab,” said Dan Smith, Tax and Budget Advocate for U.S. PIRG. “Right now, this kind of tax dodging is perfectly legal, but it’s not fair and it’s time to put an end to it.”
At least 83 of the top 100 publicly traded corporations in the U.S. make use of tax havens, according to the GAO. American companies like Wal-Mart, Coca Cola, and Pfizer – which benefit from our educated workforce, infrastructure, and security – keep more than 70% of their cash offshore. Thirty of America’s largest, most profitable corporations actually made money off our tax code between 2008 and 2010 by avoiding taxes altogether and receiving tax rebates from the government. By using offshore tax havens, corporations and wealthy individuals shift their tax burden to ordinary Americans and small businesses, forcing us make up the difference through cuts to public services, a bigger deficit, or higher taxes for everyday citizens.
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Explore Tax Justice in the Movie “We’re Not Broke” June 14th, 2012
The FACT Coalition (a campaign of the Tax justice Network USA) in raising questions about the real causes of the financial crisis. According to the movie We’re Not Broke, “conservative pundits and politicians continue to push a false narrative. America hasn’t gone broke, we’ve been robbed. Corporations have spent years dodging their responsibilities and not paying their fair share.”
Victory in US Senate for Tax Justice! March 9th, 2012
This week, the Senate took a stand against one of the largest revenue drains facing developing nations today – tax avoidance. Members of the Financial Accountability and Corporate Transparency (FACT) Coalition, have been speaking out against the abuse of off-shore tax havens. And the Senate listened.
Amendment 1818, the Levin Amendment, passed the Senate last night and is a blow against corruption, secrecy, and tax avoidance that aims to end the use and abuse of off-shore tax havens. These tax havens help large corporations and corrupt individuals avoid paying a fair share of taxes to the nations in which they operate. An estimated $160 billion dollars is lost in tax revenue in developing countries due to the use of off-shore tax havens. The Levin amendment gives law enforcement officials tools to stop financial institutions in tax havens from aiding US tax cheats, and help put an end to developing country tax avoidance.
Jubilee USA and the Oblates are founding members of the Financial Accountability and Corporate Transparency (FACT) Coalition. Learn more about tax justice…