Learn About Illicit Financial Flows
Key Terms

Eurodad: Report urges EU to get tough on multinational tax avoidance

November 21, 2011

Eurodad

Dodges cost developing countries billions in lost revenue 

BRUSSELS, 21st November, 2011: Pressure has mounted on the EU to crack down on tax avoidance by multinational companies with the release of a report that reveals in detail and with examples how dodgy accounting deprives some of the world’s poorest nations of billions of dollars in revenue.

Multinational tax dodges are estimated to account for over half of all illicit capital flight from developing countries, thwarting poor nations’ efforts to build up their own economies. Despite commitments by OECD and G20 leaders, the problem is getting worse.

This report shows how in a single year just one company dodged $174m of taxes in Zambia ” said Núria Molina, director of the European Network on Debt and Development (Eurodad) which produced the report

poor countries depend on international aid because domestic resources are lost to tax dodging. Corporate tax dodging also affects European countries, therefore addressing these practices will benefit citizens both in the North and South” she added.

The EU should consider showing leadership by implementing full country-by-country disclosure as suggested in this report this would help identify the abusive corporate practices that cost developing countries and European citizens billions each year” said Sven Giegold MEP

In 2010 US Congress passed the Dodd-Frank bill which requires listed companies in the extractive and forestry industries to disclose payments to governments on a country-by-country and project-by-project basis. The EC has released a similar proposal, Member States and MEPs have until early 2012 to improve these proposals.

Co-author of the report, Eurodad senior policy and advocacy officer, Marta Ruiz said of the proposal “This is a very welcome step to combat corruption in resource rich countries, but a full global picture of a company’s economic activity is needed to address tax dodging, the greatest source of illicit capital flight. Reporting rules must reveal this picture and apply to all sectors, as tax dodging is widespread in all industries not just extractives and forestry.

END

Contact: Marta Ruiz, Senior Policy and Advocacy Officer, tel: +32 (0)2 894 4648, email: mruiz@eurodad.org

Read the ”Exposing the lost billions“ report.

 

Share
Latest Press Releases

European Commission’s Tax Transparency Package keeps tax deals secret

Financial Transparency Coalition · March 18, 2015

The European Commission’s new measures to combat secret tax deals made between multinational companies and governments cannot be called ...

The world can’t afford to exclude developing countries from new anti-tax evasion system

Financial Transparency Coalition · March 16, 2015

BRUSSELS—Weeks after the shocking revelations of wide-spread tax evasion at HSBC’s Swiss branch, a new report from a European Commission expert ...

Leaked HSBC Records Shed Light on Culture of Corruption in the International Banking System

Global Financial Integrity · February 9, 2015

WASHINGTON, DC – Leaked HSBC documents revealed today by the International Consortium of Investigative Journalists (ICIJ) highlight a culture of corruption in the ...