Transparency, global standards key to tax dodge fight

Weak international response to tackling tax havens costs Canada $8 billion a year in lost tax revenue. But Howlett  says the failure of international cooperation in tax matters costs developing countries $70–120 billion per year.

Ottawa (28 Nov. 2016) — National civil society groups have joined Canadians for Tax Fairness to step up its fight against the global tax avoidance epidemic by pushing for strong UN action

In a letter to Finance Minister Bill Morneau and Global Affairs Minister Stéphane Dion, the groups — including the National Union of Public and General Employees (NUPGE) — call for the establishment of an intergovernmental body that can tackle cross-boundary tax avoidance and evasion. It is a concept endorsed by UN Secretary-General Ban Ki Moon, independent experts on human rights and poverty issues, and by the Independent Commission for the Reform of International Corporate Taxation.

With all the proof of tax dodging, why isn't more being done to stop it?

“The international tax dodging industry is profiting from anemic international cooperation on tax rules and standards,” says Dennis Howlett, Executive Director of Canadians for Tax Fairness. “The Panama Papers, Luxembourg Leaks, and numerous other global schemes have exposed large-scale tax evasion and avoidance. Individual governments can make some changes to stop it — but just like fighting international terrorism or environmental degradation — countries are more effective when they work together."

Weak international response to tackling tax havens costs Canada $8 billion a year in lost tax revenue. But Howlett says the failure of international cooperation in tax matters costs developing countries $70–120 billion per year.

Countries losing out on tax revenue needed to provide public services

“By exposing the tax systems of all countries to this financial pillaging, governments are deprived of the vital resources needed to provide public services and ensure human rights.,” says Howlett. “It is a failure with enormous human impact.  Yet, it can begin to be solved with transparency, global standards and common sense.” 

Howlett says there is growing demand in the business community for action.  “It would be of great value to small and medium enterprises as well as multinationals,” Howlett says. “Some CFOs have called for international consistency and a level playing field.”

The Canadian government has recognized the problem of tax dodging but has done very little to go after the culprits. "As the international community grapples with the glut of millionaires and corporations that refuse to pay their fair share of taxes," said Larry Brown, NUPGE President. "Canada needs to tackle this problem as well. If we're not doing enough to ensure that tax dollars aren't flowing out of Canada, how can we expect other countries to do the same."

Ecuador to propose global tax body at UN General Assembly

The government of Ecuador, which is the incoming chair of the G77, has announced its intention to propose a global tax body at the UN General Assembly during its next session.  In Ottawa, Canadians for Tax Fairness has been working with the Ecuadorean Embassy on a roundtable on the issue at Carleton University in the near future. Invited guests include Nobel economist Joseph Stiglitz who has been adamant about changes needed in the current global tax landscape. 

NUPGE

The National Union of Public and General Employees (NUPGE) is one of Canada's largest labour organizations with over 370,000 members. Our mission is to improve the lives of working families and to build a stronger Canada by ensuring our common wealth is used for the common good. NUPGE

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