27 January 2012
The Bishop of Derby has raised the issue of multinational corporations dodging taxes in developing countries in the House of Lords.
Christian Aid estimates that poor countries lose $160 billion a year, which is more than they receive in aid, because of multinational companies not paying the tax they owe.
In a written question, the Bishop, Alastair Redfern, asked the government ‘what steps they were taking to ensure that multinational companies are compliant and transparent in their dealings with developing countries.’
Baroness Northover responded, claiming that the Department for International Development (DfiD) is ‘committed to promoting responsible business conduct by multinational companies in their dealings with developing countries’.
She added that DfID also supports the UN Global Compact, which is the world's largest voluntary initiative encouraging businesses to improve their performance in relation to human rights, labour, the environment and anti-corruption.
Baroness Northover also told the Bishop that the UK ‘works in partnership with the Ethical Trading Initiative to promote better working conditions in the supply chains of its member companies’.
In a second question, Bishop Redfern also asked about what the government is doing to make sure companies working in developing countries are paying the taxes they owe.
The Treasury’s Commercial Secretary, Lord Sassoon, replied, saying the government is working to bolster developing country tax administrations to ensure that they can collect the taxes due to them.
Christian Aid’s Principal Economic Justice Adviser, David McNair, welcomed the Bishop’s questions and urged the government to push for legislation to ensure profits made in developing countries cannot be hidden offshore.
He said: ‘Christian Aid is delighted that the issue of tax justice is being examined in the House of Lords.
‘The matter of lost tax revenues from the world’s poorest countries is an ethical and moral issue on which faith leaders are beginning to take a lead.
‘We now need action at a political level, to ensure transparency between multinational companies and the developing countries where they operate.’
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