“We will continue to act aggressively against the evasion of tax through transfer pricing abuses, misuse of tax treaties and illegal money flows. Drawing on the work of the OECD, the G20 joint project on base erosion and profit shifting and independent bodies such as the Tax Justice Network, further measures will be taken to address such revenue losses, including inappropriate use of hybrid debt instruments.”
A bit self-congratulatory of us to put this here, but hey. We’d add, however, a couple of things.
First, we’ve done some specific work on this: see here – including a South African component. There is a lot of very good African-led research coming out: we’d highlight in particular the recent book Capital Flight from Africa, edited by Ibi Ajayi & Léonce Ndikumana. We should also draw attention to the good work of TJN-Africa, and the related Global Alliance for Tax Justice and the Stop the Bleeding campaign in helping drive the agenda on the continent.
South Africa has long been a leader in Africa in this area, not least Gordhan’s predecessor Trevor Manuel, who was speaking up on these issues before most of the world had started waking up to the issues. As he put it in 2008:
“It is a contradiction to support increased development assistance, yet turn a blind eye to actions by multinationals and others that undermine the tax base of a developing country.”
Well said, both finance ministers. As more attention is steadily paid to this issue, the more attention will be turned towards some of the most important facilitators of corruption and state looting in Africa and elsewhere. The culprits are identified in a handy ranking, here.
And we’ll be discussing all this in great detail, here.