Inequality

  • The widening gap between the world’s richest and poorest people is tearing societies apart. Too many still toil in extreme poverty. In contrast, wealth is increasingly concentrated in the hands of a few, who can use it to capture disproportionate power to shape the future. The widening gap between the richest and poorest is damaging economies and pushing more people into poverty. There are practical ways to close the gap.

EU blacklisting criteria puts Ireland’s tax haven status beyond doubt

·         More royalties sent out of Ireland than rest of EU combined, equivalent to 26% of GDP in 2015

·         New Oxfam report urges EU to tackle tax avoidance within member states

Tuesday, 28th November 2017

A new report published by Oxfam today has identified Ireland as one of four EU countries which would be blacklisted1 as a tax haven if the EU were to apply its own criteria to member states.

The EU is currently drafting a blacklist for tax havens, analysing 92 non–EU countries and jurisdictions against a set of three criteria, which include tax transparency and policies that facilitate large-scale profit shifting. However, this process excludes EU member states, meaning that they will not be assessed.

For the first time, Oxfam has applied the EU’s own criteria to 92 countries worldwide as well as to the 28 EU member states. According to the analysis, at least 35 non-EU countries should be included in the EU tax haven blacklist.

Furthermore, four EU member states: Ireland, Luxembourg, the Netherlands and Malta also met the criteria for being listed as a tax haven.

Ireland fails to meet the second criterion on fair taxation and the facilitation of tax avoidance. For example, the report establishes that royalties sent out of Ireland were equivalent to 26% of the country’s gross domestic product in 2015. That is more royalties than are sent out of the rest of the EU combined, and makes Ireland the world’s number one royalties provider2.

Jim Clarken, Oxfam Ireland Chief Executive, said: “As Ireland fails the EU’s blacklisting criteria, it is clear that the Government has questions to answer with regard to its stated commitment to tackling tax avoidance. In the past, the case has been made that because Ireland’s tax arrangements fulfilled OECD standards there was no substantiation that Ireland matched the conditions associated with tax haven status. The OECD’s blacklisting process has been called into question due to the fact that it only listed one country Trinidad and Tobago as a tax haven.

“The analysis in this report uses the very measurements the EU is currently applying to 92 non-EU states to assess whether they should be blacklisted as tax havens. Sadly, this analysis places Ireland in an elite club with four other EU countries; Malta, Luxembourg and the Netherlands.”

The report, Blacklist or Whitewash: What a real EU blacklist of tax havens should look like, shows how financial flows are often completely out of proportion with the tax havens’ real economic activity. In the British Virgin Islands, foreign direct investment amounts to 90,000% of the country’s GDP. For the Cayman Islands, it represents 5,400% of the GDP, for Malta 650% and for Luxembourg approximately 400%.

Oxfam is concerned that, regardless of these clear findings, EU governments will come up with a weak or even empty blacklist. The blacklist is being drafted in secret, which makes public scrutiny impossible. The Maltese EU presidency has publicly advocated for an empty blacklist. Also, following a meeting with EU finance ministers, the Swiss government has openly declared it does not expect the country to be blacklisted.

Oxfam is also urging the EU to put rules in place to reform the tax systems of EU countries like Ireland, Luxembourg, the Netherlands and Malta which meet the EU’s criteria for being listed as a tax haven.

Mr Clarken continued: “An ambitious and objective list of tax havens with strong countermeasures is a concrete and powerful way to clamp down on tax avoidance which deprives countries of hundreds of billions of dollars, fueling poverty and inequality. If the EU is serious about preventing tax havens from engaging in harmful practices that affect us all then it should stand up to political and corporate pressure and create a genuine blacklist, not a whitewash.”

ENDS

CONTACT: For more information or interviews, please contact Alice Dawson, Oxfam Ireland, on +353 (0) 83 198 1869 or at alice.dawson@oxfamireland.org

1.     Blacklist: Establish a “blacklist” of countries that refuse to adhere to international taxation rules. Listed countries should face stiff penalties.

Oxfam applied the EU’s own criteria to the 92 countries screened by the EU, and the 28 EU member states. According to Oxfam’s analysis, at least 35 non-EU countries should be included in the EU tax haven blacklist: Albania, Anguilla, Antigua and Barbuda, Aruba, Bahamas, Bahrain, Bermuda, Bosnia and Herzegovina, British Virgin Islands, Cook Islands, Cayman Islands, Curaçao, Faroe Islands, Former Yugoslav Republic of Macedonia, Gibraltar, Greenland, Guam, Hong Kong, Jersey, Marshall Islands, Mauritius, Montenegro, Nauru, New Caledonia, Niue, Oman, Palau, Serbia, Singapore, Switzerland, Taiwan, Trinidad and Tobago, United Arab Emirates, US Virgin Islands, Vanuatu. And four EU member states, Ireland, Luxembourg, the Netherlands and Malta

2.     Passive income such as royalties for Intellectual Property (IP), which companies are known to use to avoid tax. High levels of these payments far above normal economic activity indicates that the jurisdiction is facilitating tax avoidance.

Notes to editors:

·          Read the full Oxfam report: https://oxfam.box.com/v/EUBlacklistReport

·          An interactive map shows the 39 countries listed in the report and explains why they fail to meet the EU’s blacklisting criteria: https://public.tableau.com/profile/oxfam.eu.office#!/vizhome/ShadowEUtaxhavenblacklist_0/ShadowEUtaxhavenblacklist-map

·          The EU committed to a blacklist process in the wake of scandals like the Panama Papers and Lux Leaks that showed how tax havens let the super-rich get away with billions in unpaid taxes. EU finance ministers are expected to publish the EU blacklist on 5 December at their meeting in Brussels.

·          The EU’s listing process uses three sets of criteria to identify tax havens: transparency, fair taxation, and participation in international fora on tax.

·          The EU’s blacklisting negotiations have taken place behind closed doors and countries participating in the talks have refused to answer questions. The process has been in the hands of one of Brussels’ most secretive working bodies, the so-called Code of Conduct Group, which insists on its work being confidential.

·          Last June the OECD released its own backlist, but the result was farcical and ended up naming only one country, Trinidad and Tobago.

·          Tax dodging costs developing countries $170 billion a year: $70 billion through tax dodging by super-rich individuals and $100 billion through corporate tax dodging. $100 billion is enough money to provide an education for 124 million children and prevent the deaths of almost eight million mothers, babies and children a year.

·          Switzerland, which fails the EU’s criteria on fair taxation according to Oxfam’s analysis, has already declared they expect not to appear on the EU blacklist. This illustrates the risk that major tax havens might escape blacklisting due to political and economic pressure.

·          Following the Paradise Papers, Oxfam released a 5-point plan outlining steps governments should take to prevent further scandals on a global scale. This includes establishing a global blacklist of tax havens that naming countries such as Ireland and the Netherlands that have been key players in the Paradise Papers scandal. 

Give an unexpected gift this Christmas

Christmas songs playing in shops, lights strewn between buildings on city streets, shopping windows decorated with evergreen trees and holly, rosy cheeks on passers-by. The Christmas season has officially begun.

This also means crowded shops, long queues, and heavy bags. Ba-humbug!

Instead of enduring the crowds, waiting in queues and braving the cold, consider nestling up to a warm cup of tea with your internet browser opened to Oxfam Unwrapped.

Oxfam Unwrapped offers 17 unique and unexpected gifts ranging from €5/£5 to €1,000/£926. Whether it’s a cooking stove or a clutch of chicks, each gift funds Oxfam’s work around the world. Don’t worry… a clutch of chicks won’t arrive on your doorstep. Your gift donation goes toward poor families and communities that need it most.

Leave the soap and lotion gift baskets at the shops. Instead, purchase our soap stocking filler for a family member. Money raised from your donation supports humanitarian work from our Saving Lives fund. It provides people like Binta and her daughter Fati in Niger with hygiene training to keep them from illness and deadly diseases.

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Your unexpected gift card from the Unwrapped campaign provides the tools, training and resources to support and empower communities. While bringing a smile to your loved one’s face, you will also be building brighter, happier futures. Happy shopping!

Latest Paradise Papers scandal reveal that “Ireland tied itself in knots hoping to retain Apple”

Minister Donohoe must support moves on tax haven “blacklisting” at tomorrow’s EU meeting

Responding to the latest Paradise Papers revelations which contain startling information about multi-national companies such as Nike and Glencore and which highlight Ireland’s relationship with Apple, Jim Clarken, Oxfam Ireland, CEO said;

“The latest leaks show the lengths to which major multi-nationals have gone to avoid tax. Tellingly, they claim that “Ireland tied itself in knots hoping to retain Apple”. This is unedifying, damages our international reputation and deprives governments of vast sums in tax revenue.

Tomorrow in Brussels, EU finance ministers will discuss setting up a blacklist of tax havens. Blacklisting is one measure which can be effective for tackling tax avoidance, so Minister Donohoe needs to express Ireland’s unequivocal support for the move."

Corporations such as Apple, Nike and Glencore spend millions lobbying governments to water down tax reforms. The 50 biggest US companies, including Apple, spent an estimated $352 million lobbying on tax issues in the country between 2009 and 2015 while receiving over $423 billion in tax breaks. For every $1 they spent lobbying on tax issues they received an estimated $1200 in tax breaks

Time for Irish Government to back tax transparency reforms

6 November 2017 
 
Ireland needs to get on board with proposed EU reforms which would tackle the type of scandalous activity revealed in the Paradise Papers, Oxfam Ireland has said today. 
 
Information released in the papers has shed new light on the role played by Irish banks that allowed some of the world’s most profitable corporations significantly reduce their tax bills. Further details of Ireland’s involvement are also scheduled to be released. 
Oxfam Ireland, CEO Jim Clarken said; “I wish I could say that I was surprised by the detail contained in the Paradise Papers and Ireland’s suggested involvement.  However, we’ve been here before with the Panama Papers and other leaks. Nevertheless, we can’t just shrug our shoulders and accept this as a part of international commerce.
 
Tangible options are now available to put a stop to this murky world where corporations and the super-rich cheat governments out of billions in revenue. 
 
Ireland now has the opportunity to show leadership by supporting EU proposals aimed at fighting this type of tax evasion. This is especially important considering that our own country’s tax arrangements have been implicated as facilitating some of these nefarious practices. So now is the opportune time for the Irish Government to show their support for these reforms.” 
 
Specifically, the Irish Government now needs to support:
 
Public Country by country reporting: This requires large multinational companies to disclose where they generate profits.  This means that companies would have to pay taxes in the country where the profits are made. Currently, they declare profits in offshore havens where in reality, the company has little or no activity and pay miniscule tax. 
 
Establish a “blacklist” of non-tax compliant countries: Compile a list of those nations which refuse to adhere to international tax rules. Listed countries should face stiff penalties. Currently Trinidad and Tobago is the only blacklisted country in the world which is not credible. 
 
Jim Clarken said; “At the core of these reforms is transparency. These is no legitimate reason for big corporations to hide their tax affairs. The only reason multi-national companies use these offshore funds is to allow them avoid paying their fair share of tax. Tax that could be used in Ireland and in poorer nations to help fund health, education and other social services. 
 
The Irish government must show commitment to playing its part in tackling this global scandal by supporting reform measures at EU level. In the past, the Irish Government claims that it fulfils international standards in tax transparency as set out by the OECD. However, under these transparency standards the tax information of multinational companies remains secret.  
 
These so-called ‘transparency measures’ haven’t prevented the abuses we are seeing in the Paradise Papers. It is obvious that public reporting is needed to end these abuses once and for all.
 
Government has said that tax avoidance is a problem best tackled at international level. Now is their opportunity to be part of this global response by dropping its opposition to these vital reforms.” 
 
Oxfam estimates that over $7 trillion of personal wealth is hidden in these offshore accounts. At least $100 billion of tax revenue is lost to developing countries alone every year. Even if half of this money was paid in taxes, the lives of 8 million women, children and babies would be saved. Ireland, the lack of tax revenue leads to essential services being cut or additional taxes imposed on ordinary citizens. 
 
ENDS
 

REPUBLIC OF IRELAND: Daniel English on +353 (0) 86 354 4954 / daniel.english@oxfamireland.org

NORTHERN IRELAND: Phillip Graham on +44 (0) 7841 102535 / phillip.graham@oxfamireland.org

 

Paradise Papers reveal governments still losing billions through tax dodging scams

Political leaders must put interest of public over corporates and super rich-Oxfam Ireland

5 November 2017

Spokesperson available

First came #LuxLeaks, then #Panama Papers. Now, today the so called #Paradise Papers reveal that governments are still losing billions in revenue due to international corporations and billionaires hiding their fortunes and avoiding paying their taxes.

Today as the International Consortium of Investigative Journalists published details of the companies and individuals cheating governments out of billions of dollars in tax revenues, Oxfam Ireland is demanding that political leaders put the interests of the public over corporates and the super-rich and put a stop to the scandal of tax dodging.

Oxfam Ireland, CEO Jim Clarken said: “The Paradise papers are yet another ugly insight into how the global tax system is being exploited by those who should be paying most. They reveal the staggering scale of the tax dodging scams and evasion tricks which are depriving governments of billions in income.

The revelations in the Paradise Papers also expose our leaders’ feeble attempts to stop tax cheats. Following the Panama Papers expose, we heard tough talk from politicians but this has translated into weak reforms thanks to pressure from big business and the super-rich.

We must remember that tax dodging impacts on everyone whether they live in richer nations or the developing world. It fuels poverty and inequality. When the super-rich and corporations dodge taxes it is ordinary people, who pay the price.

Just think how the additional revenue could help improve services in a country like Ireland. The extra taxation could be directed towards schools, hospitals and other social services. Some of the billions dodged by corporations and the super-rich in poor countries every year could fund the healthcare services needed to prevent the deaths of millions of mothers, babies and children.”

Oxfam Ireland is proposing several ways to stop the global tax dodging:

  • Establish a “blacklist” of countries who refuse to adhere to international taxation rules. Listed countries should face stiff penalties.
  • End tax secrecy. Establish a publicly-available, register of companies so we know who their real owners are. This will make it easier to follow the money.
  • Introduce a second round of tax reforms to build on the BEPS1 (Base Erosion and Profit Shifting) process. This time it should work in favour of all countries, not just the wealthiest.

Jim Clarken said: “Governments, including Ireland’s must work together to shut down tax havens by establishing a global tax haven blacklist; end tax secrecy so that its clear if corporations and the super-rich pay their fair share of tax; and kickstart a new round of tax reforms that rebuild the tax system in the interests of the majority and not the few.

It is not good enough to argue that tax avoidance is permissible because practices fall within the letter of the law. Legal loopholes abuse a broken system. Everyone has a responsibility to contribute towards the public services and infrastructure on which we all rely.

These changes take a lot of time and effort, but most importantly, they take political will. Otherwise, the super-rich will keep siphoning billions of dollars away into their offshore accounts.”

To learn more about Oxfam Ireland’s tax justice campaign go to https://www.oxfamireland.org/tax

ENDS

REPUBLIC OF IRELAND: Daniel English on +353 (0) 86 354 4954 / daniel.english@oxfamireland.org

NORTHERN IRELAND: Phillip Graham on +44 (0) 7841 102535 / phillip.graham@oxfamireland.org

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