14 March 2016 - The Chancellor should practice what he preaches in his Budget on Wednesday and stop UK based multinational companies hiding their tax dodging from public view, Christian Aid says today.
The charity’s call comes ahead of a new cross-party Parliamentary demand for greater transparency around multinationals’ tax affairs.
The 10-Minute Rule Bill being introduced on Tuesday by Caroline Flint, MP for Don Valley and a Member of the Public Accounts Committee, proposes that companies should have to file new-style financial reports with Companies House so that their global tax records are publicly available to all.
“After years of tax scandals, no less than the Chancellor himself has recognised that these company reports should be made public,” said Toby Quantrill, the charity’s Principal Adviser on Economic Justice.
“George Osborne should now use his Budget to put his money where his mouth is. He will have the comfort of cross-party support as well as the knowledge that he will be helping the UK and other countries to collect their fair share of tax from giant companies.”
Large multinationals are already being required to file their new reports with the UK taxman but there are tremendous additional advantages to also making them public.
“Allowing politicians, investors, journalists, academics, campaigners, and fellow taxpayers to see multinationals’ country-by-country reports will greatly increase the pressure on companies to pay their fair share of tax in all the countries where they operate,” added Mr Quantrill.
“Developing countries face an even tougher struggle than the UK to make multinationals pay the right amount of tax, leaving their own people in poverty and without essential services such as hospitals and schools. If the UK makes multinationals’ country-by-country reports public, then it will be helping the tax authorities of developing countries to collect what is due.
“Christian Aid joins more than 30 MPs in supporting this Bill and calling on the Chancellor to introduce full public country-by-country reporting in the UK in Wednesday’s Budget. When the UK walks the talk, it will have the credibility to convince other countries to adopt the same transparency standards.”
Country-by-country reports set out companies’ financial affairs separately for every country in which they operate; for instance they show firms’ taxes paid, profits made and staff employed in each country.
The case for tax transparency was also made recently by the Public Accounts Committee, when it published its critical report about the UK’s controversial tax settlement with Google. The Committee called among other things for the UK to consult widely on making multinational companies’ tax affairs open to public scrutiny, as a means of enabling Parliament and others to judge whether particular tax deals are reasonable.
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Notes to editors:
1. Christian Aid works in some of the world's poorest communities in around 40 countries at any one time. We act where there is great need, regardless of religion, helping people to live a full life, free from poverty. We provide urgent, practical and effective assistance in tackling the root causes of poverty as well as its effects.
2. Christian Aid’s core belief is that the world can and must be changed so that poverty is ended: this is what we stand for. Everything we do is about ending poverty and injustice: swiftly, effectively, sustainably. Our strategy document Partnership for Change explains how we set about this task.
3. Christian Aid is a member of ACT Alliance, a global coalition of more than 130 churches and church-related organisations that work together in humanitarian assistance, advocacy and development.
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5. For more information about the work of Christian Aid visit http://www.christianaid.org.uk