Report: better tax rules could boost developing country corporate tax revenues by 100%

Eng_governments exluded_twitterA new report from Oxfam, entitled BUSINESS AMONG FRIENDS: Why corporate tax dodgers are not yet losing sleep over global tax reform.

It begins like this:

“Tax dodging by big corporations deprives governments of billions of dollars. This drives rapidly increasing inequality. Recent G20 and OECD moves to clamp down on corporate tax dodging are a first step, but these have woken up a legion of opponents set on undermining them.

Most developing countries, which lose billions to corporate tax dodging annually, are also being left out of the decision making. Commercial interests must not be allowed to pursue their agenda at the cost of the public interest. All developing countries must be included in negotiations, and corporations must pay what they owe.”

The attached press release notes:

“According to new figures from a forthcoming study by tax expert Alex Cobham and economist Petr Janský, if multinationals were taxed in countries where real economic activity takes place, then corporate tax revenues in some developing countries could increase by more than 100%.”

Interestingly, the basis for the calculation is described:

“The figures used by Oxfam represent the preliminary findings of the forthcoming study: Cobham, A. & P. Janský, 2014, ‘Misalignment between US multinational activity and profits, and the potential development impact of formulary apportionment’.
. . .
The results show the implication for the distribution of the corporate tax base resulting from US-headquartered multinationals if profits were distributed according to economic activity.”

Formularly apportionment is a central component of unitary taxation, which TJN has recently played a leading role in endorsing, and is engaged in a research project to explore.

Plus two more wonderful Oxfam graphics, which are worth sharing widely.

Eng_inequality_twitterEng_business_lobbyists_twitter


Related Posts

The Offshore Wrapper: the Panama Papers, one year on

Photos from the Protest outside PwC 1 Embankment Place, part of the Global week of action for tax justiceWelcome to the Offshore Wrapper – your weekly update from TJN.  Happy Paniversary! This week it’s been one year since the Panama Papers were leaked, and a number of organisations around the world have been marking the occasion though the global week of action for tax justice. In London, activists from the TJN and the […]

READ MORE →

Protesting PwC: Professionals Without Conscience

Photos from the Protest outside PwC 1 Embankment Place, part of the Global week of action for tax justiceThis week is the global week of action for tax justice and on Wednesday 5th April activists from the Tax Justice Network and Methodists for Tax Justice held a protest outside the London offices of Price Waterhouse Coopers. The global week of action for tax justice is happening one year after the release of the […]

READ MORE →

Germany moves forward on corporate transparency

ReichstagThe Bundesrat has today voted to recommend implementing a public register of the beneficial ownership of companies and trusts.  Great news from Germany, as the country takes an important step forward towards corporate transparency.

READ MORE →

New estimates reveal the extent of tax avoidance by multinationals

Price Waterhouse CoopersNew figures published today by the Tax Justice Network provide a country-level breakdown of the estimated tax losses to profit shifting by multinational companies. Applying a methodology developed by researchers at the International Monetary Fund to an improved dataset, the results indicate global losses of around $500 billion a year. The figures appear in a […]

READ MORE →

Banking Secrecy in China, its related territories and Taiwan

Hong Kong from Sky 100Foreword. The Tax Justice Network is a non partisan network of experts working towards transparency, so we do not take any position about countries’ territorial and political claims. However, we do expect countries with a de jure (legal) or de facto (in practice) influence over other territories, to take responsibility for their power. We point […]

READ MORE →

Leave a Reply

Your email address will not be published. Required fields are marked *

Back to Top