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Fight tax abuse, don’t raid the aid budget, urges Christian Aid

6 May 2013 - The UK Government should concentrate on helping stop the damage caused by tax abuse in developing countries rather than raiding the aid budget, Christian Aid said today.

A stream of media reports in recent days have suggested that the Government is having second thoughts about its ring fencing of 0.7 per cent of GNI for overseas aid.

Prime Minister David Cameron and other senior ministers have indicated that it could also be used to pay for military projects such as peace keeping and demobilisation.

Meanwhile, a chance to help poorer countries achieve economic independence appears to have been ignored.

British Overseas Territories that operate as tax havens have agreed to share details of secret account holders with the UK and several other European governments. Crucially, however, no such access has been agreed for developing countries.

Christian Aid’s Senior Economic Justice Adviser Joseph Stead said that while the new tax deal was welcome, it will do nothing for poor countries losing billions to tax havens as a result of tax dodging and corruption.

‘At a time when the UK is withdrawing aid from some countries, such as India and South Africa, and there are reports that the 0.7 per cent at present ring-fenced for overseas aid is under attack, one would have thought the Government would be keen to help poor countries collect the tax revenues they are due.

‘We would like to see much more joined-up Government thinking about aid and action against tax dodging and corruption.

‘In practice, it means ensuring that poor countries, as well as rich ones, benefit from deals which force tax havens to come clean about the money foreign taxpayers have hidden within their banks, trusts and so on.

‘It also means fully including developing countries in the talks about reforming the global rules on the taxes paid by multinational corporations.

‘At present the UK is leaving countries like India and South Africa with the worst of both worlds – removing aid at the same time as excluding them from international deals which could help them recover some of the vast sums they currently lose to tax dodgers and those who steal public money. This is both short-sighted and unjust.’

For more information, contact Rachel Baird on 00 44 (0)207 523 2446 or ring the 24-hour press duty phone: 07850 242950.


 

Notes to editors:

1. Christian Aid works in some of the world's poorest communities in around 50 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 has a vision, an end to global poverty, and we believe that vision can become a reality. We believe that the underlying causes of poverty were made by, and can be ended by, human action. Our strategy for building the power of us all to end poverty is embodied in a new report ‘Partnership for Change’: http://www.christianaid.org.uk/Images/2012_strategy.pdf

3. Christian Aid is a member of the ACT Alliance, a global coalition of more than 130 churches and church-related organisations that work together in humanitarian assistance, advocacy and development.  Further details at http://actalliance.org

4. Follow Christian Aid's newswire on Twitter: http://twitter.com/caid_newswire

5. For more information about the work of Christian Aid visit http://www.christianaid.org.uk