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.

92% public support in Northern Ireland for an end to corporate tax dodging

Let’s be honest – a tropical tax haven island looks a bit out of place in Belfast.

The reason why we brought palm trees and deckchairs to the heart of the city was to highlight new research showing the kind of scenario people want to avoid as a result of any change to Northern Ireland’s corporation tax rate.
 

 
The new research, commissioned by Oxfam and undertaken by Millward Brown Ulster, found:
 

• 92% of people in NI say governments should ensure big firms pay tax in poor countries which need more revenue to tackle poverty;

• 89% are concerned that when big companies and wealthy individuals use tax loopholes to avoid paying their fair share of tax, ordinary people pay the price because of the impact on public services;

• 87% say that ending this tax avoidance should be a priority for Theresa May’s government;

• 88% of those polled say the public have a right to know where big companies are making profits and paying tax;

• 80% say the gap between the richest and the rest of society is rising and making Northern Ireland a more unequal place

Help us make tax fair in Northern Ireland and across the UK - tell Prime Minister Theresa May to tackle tax dodging.

With Northern Ireland set to take control of corporation tax in 2018, it’s clear from this survey that there is overwhelming public support to ensure any new proposed tax regime here is fair, open and transparent – and that it does not negatively impact on vulnerable people.

Any reform of the corporate tax system needs to contain safeguards preventing companies from taking advantage to avoid tax owed elsewhere – otherwise there is a risk that Northern Ireland could be used as a tax haven.

What we mean by safeguards includes making multinational companies publish tax information for all countries where they are present. In addition, we want to see the establishment of a public centralised register of beneficial ownership that would allow citizens here and in developing countries to know who is really behind companies and trusts.

What’s needed is an economic policy that will bring jobs, prosperity and stability to the province, without being at the expense of essential public services in Northern Ireland or in poor countries.

The Stormont Executive has an opportunity to create a best in class tax system that reflects genuine economic activity and works for the people of Northern Ireland, not against them. This should take into consideration the local and global dimensions of tax avoidance and its impact.

The impact of tax dodging can seem like an abstract thing but it has a very real human cost. An estimated $100bn (approximately £79bn) is lost to developing countries every year because of tax dodging by multinationals. Every school that is not built, every medicine that is not bought for lack of government funds due to tax dodging affects thousands of men, women and children across the world.

Our Make Tax Fair campaign highlights that tax dodging is starving developing countries of the money needed for education, healthcare and tackling poverty.

 

Apple tax ruling tip of the iceberg - EU governments must do more

The European Commission today ruled that Apple received €13 billion in illegal state aid from the Irish government.

This decision follows the investigations on illegal state aid between the Dutch government and Starbucks, the Luxembourg government and Fiat, and the Belgian government for its ‘excess profit’ tax scheme.

Reacting to the decision, Jim Clarken, Chief Executive at Oxfam Ireland, said: “Ireland has benefitted from multinational investment but all companies should operate here under rules which are fair and which do not benefit some companies over others. Deals that exempt companies from paying their legitimate share of tax mean the ordinary taxpayers have to foot the bill.

“Apple is one of the world’s most well-known companies and Irish consumers want their favourite brands to do the right thing and pay their fair share of tax. A nationwide survey commissioned by Oxfam earlier this year found that the vast majority (86%) of people believe that big companies are using tax loopholes to dodge paying their fair share of tax. 83% believe vital public services like schools and hospitals in Ireland and across the world are suffering as a result.

“The Government now must move to end these practices for once and for all, and reassure citizens that sweetheart tax deals with either companies or individuals are a thing of the past. They cannot be tolerated, especially when public services are in vital need of investment.

“So far, multinationals found by the European Commission to have benefitted from sweetheart deals only have to pay the taxes they were previously able to avoid and no additional fines are levied. The status quo clearly does not pose a sufficient deterrent whatsoever.

“Adequate measures to prevent such deals in the future must include public disclosure of where multinational companies generate profits and where they pay their taxes, giving governments and citizens the power to hold them to account.

“A proposal earlier this year by the European Commission obliging companies to publicly disclose more information about their tax arrangements is too weak – it will only apply to the biggest of companies and the information they need to provide is too limited. The European Parliament and Member States need to strengthen these requirements by making them apply to all large multinationals, and multinationals must be forced to publish tax information for all countries where they are present. “In addition, the establishment of a public centralised register of beneficial ownership would allow citizens here and in developing countries know who is really behind companies and trusts. Without the financial secrecy which has wreaked such havoc to the global economy, tax evasion and avoidance would be much more difficult.”

Make Tax Fair:

When big firms don’t pay the tax they should, governments lack funds for schools, hospitals and tackling poverty. Tax dodging hurts us all, but it affects poor people the most. Developing countries lose three times more to tax havens than they receive in aid each year, according to the OECD. The money lost is enough to end world hunger twice over. We want the government to ensure Irish law and tax practice does not help companies or individuals to avoid tax by requiring companies to say publicly where profits are made and tax is paid and increase international tax cooperation.

Video: Inequality in Malawi

(Subtitled so you can watch without audio.)

Inequaity in Malawi | #MakeTaxFair

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‘If those corporations were paying their dues my friend would not have died’

Clockwise from left: Cecillia, Stella and Getrude - tax justice activists, campaigning to change the policies and structures that allow rich individuals and multinational companies to avoid paying the tax they owe. Photos: Mark Bushnell/Oxfam
 
Scandals like the recently released Panama Papers show the enormous lengths people, from government officials, big businesses, celebrities and the wealthy elite, will go to avoid paying tax. 
 
The whole world has been talking about the leaked documents and those named for tax dodging – often through perfectly legal loopholes that deny poor countries of billions needed for essential services like health and education. 
 
But there are also people going to extraordinary lengths to tackle the inequality that keeps people poor and to make tax fair for everyone. 
 
People like Ene Agbo from Nigeria, Cecillia Mulenga from Zambia, Gertrude Chirwa from Malawi and Stella Agara from Kenya but working in Malawi – four inspiring women who are taking on the tax dodgers and who we are delighted to be hosting in Ireland this weekend. 
 
The four activists are currently travelling around Europe meeting with the public, decision-makers and Oxfam supporters to share first-hand how tax dodging is harming people and communities. 
 
You are invited to join us in Dublin and Belfast to hear for yourself why tackling the global toxic tax system matters and to catch their contagious energy and passion for the fight against tax dodging.  
 
Cecillia told us: “You should be around in Zambia when we are doing campaigning – it’s one of the best days…!”
 
She has a very personal reason for getting angry about public funds lost to tax dodging. A good friend of hers died when she was eight months pregnant because there were no health facilities.  
 
Cecillia says: “If those corporations were paying their dues my friend would not have died. They would have built a hospital; they would have built a better road in that same area. That would have helped her and kept her alive.”

Meet Cecillia

Cecilia - Tax activist | #MakeTaxFair

Stella said the lengths some firms go to avoid paying tax in Malawi is mind-blowing: “It is the order of the day for small business to pay more tax than multinational companies, yet multinational companies are making billions out of Malawi,” she says. 
 
Stella believes that this corporate tax dodging is driving inequality in Malawi: “For me I have seen people enjoy very wealthy lives…and I have seen people who are very poor, who don’t ever put on shoes – that is when you have seen poverty.”

Meet Stella

Stella - Tax activist | #MakeTaxFair

Gertrude is 22 years old and raises awareness about tax injustice in the community, particularly with young people. She believes it’s down to ordinary citizens to do something about tax dodging. 
 
Gertrude says: “When I learnt about it, I got really angry and motivated at the same time…I need to do something about it, I need to make others also aware there are a lot of tax injustices happening in our country and that we can do something, particularly the youth.  
 
“What I say to the campaigners in the rest of the world is: let’s keep up the good work, let’s keep fighting for tax justice – if we don’t do it, then who will?”

Meet Gertrude

Gertrude - Tax activist | #MakeTaxFair

While the headlines and the hype can make tax dodging seem complex, it is refreshing to hear from real people with real passion about what is happening on the ground – and to realise we are all connected in a global push to take on the tax dodgers and make change for good. 
 

JOIN US:

 
 
 

LIVE STREAM:

 
If you can't make the events in Dublin or Belfast, we will be doing our first ever social media live stream talk and Q&A with these activists, on Facebook and Periscope, this Saturday (April 16) at 4pm. Keep an eye on our Facebook and Twitter for more info and to join our chat on Saturday.

Christine McCartney is a Campaigns and Advocacy Executive with Oxfam Ireland

Oxfam Ireland's tax justice project is funded by the European Union

Talking tax – it’s anything but boring

Above: L-R Volunteer campaigners Lynsey Burrows, Grace De Bláca and Oxfam's Mary Quinn join activists in Amsterdam to call for action on tax-dodging and inequality.

Last month over 80 activists from Europe and across the world came together for a two day conference in the Netherlands with one shared goal: to change the way tax works. 

Lynsey Burrows from Northern Ireland travelled to Amsterdam along with fellow volunteer campaigner Grace De Bláca and Oxfam Ireland's Campaigns and Public Outreach Executive Mary Quinn. They joined the group working to tackle issues like tax dodging which robs countries of vital funds needed for essential services like health and education.

Lynsey shares her thoughts on the difficulty of communicating such an important but complex issue: 

In March, I was extremely excited to be able to attend the Tax Justice Together conference in Amsterdam with Oxfam Ireland. The tax justice movement is one of the largest social justice movements of the past few years and it is gaining momentum all the time. The conference was an opportunity for activists from all around the world to meet and discuss how best we can continue to work together to campaign for change to the global tax system. 

Within hours of arriving at the conference it became clear that there was one common problem we all faced when campaigning on tax justice in our communities: tax justice sounds boring. Unless you work in the financial industry or are a ‘tax justice nerd’ (the sort who is extremely excited to attend tax justice conferences...) anything to do with tax sounds dreary, dull and complicated. 

And it can be all of those things. Phrases like ‘tax treaties’, ‘capital gains’ and ‘bilateral investments’ are not the most easy to relate to when trying to talk to people about why tax matters. But there was also a very clear and urgent issue that any Oxfam supporter can relate to: 

Tax injustice sustains poverty – as long as there is an unfair tax system, there will be poverty. 

Without any jargon or financial knowledge needed, we can all understand that anything that maintains poverty or makes it worse is something we need to fight against. 

Developing countries are losing billions every year because of tax injustice. Tax injustice has many aspects to it and I am going to focus on just one of those. One of the main culprits is multinational companies avoiding paying tax – tax dodging. They do this through schemes such as tax treaties. Put very simply (because I don’t want to bore you but mainly because I’m not an expert either) tax treaties are an agreement between two countries to avoid paying double tax. 

So, if one multinational company (let’s call them WeLoveMoney) is registered in two countries that have a tax treaty, they will only have to pay tax in one of those counties. WeLoveMoney operates and makes an awful lot of money (which they love, hence the name) in one of those countries, the country that is developed and wealthy. But they are also registered in the developing country, where they don’t make much money but source or create their product. Can you guess which country they choose to pay their taxes in?

So because of perfectly legal loopholes, WeLoveMoney pays a very small amount of tax in the developing country where it is also generating profit and that country's government does not get its fair share of tax - money that is needed to help pay for healthcare, education and essential public services. Without the money they’re rightfully owed, poverty continues. 

The rights and welfare of the some of the poorest people in the world are being harmed by the current global tax system.  So if you hear me and other activists talking about tax, we’re really talking about poverty, about injustice and about inequality. 

And that’s not boring. 

#MakeTaxFair

Tax activists on tour | #MakeTaxFair

We've got four very special guests coming to Ireland next week - tax campaigners from Malawi, Kenya, Nigeria and Zambia. These activists work tirelessly to change the policies and structures that allow rich individuals and multinational companies to avoid paying the tax they owe. You can meet them in person in Dublin and Belfast (details below).- Dublin (April 16): http://bit.ly/1USs2Me- Belfast (April 19): http://bit.ly/23u29DX

Posted by Oxfam Ireland on Sunday, April 10, 2016

 
#MakeTaxFair tour with Tax Justice Together: We've got four very special guests coming to Ireland this April - tax campaigners from Malawi, Kenya, Nigeria and Zambia. These activists work tirelessly to change the policies and structures that allow rich individuals and multinational companies to avoid paying the tax they owe. You can meet them in person in Dublin (April 16) and Belfast (April 19).

Why tax matters?

The impact of an unfair tax system should not be measured in numbers and facts – but in its shocking human impact. 

When countries don't receive the money they are owed in tax, people suffer. Children can't go to school, parents work hard but it doesn't pay so their families still go to bed hungry at night, communities living in poverty don't have a say in the decisions that affect them. Inequality grows and poverty is made worse.

Clockwise from left: 1. Munni stands beside an open drain in Horijon Polli, the slum where she lives with her family. 2. Munni at work – despite working hard every day, Munni dreams of work that really pays. 3. Munni cooks breakfast with her two-year old son.  Photos: Adrian Lloyd/Oxfam

Munni Basfur lives with her husband and four children in one room in Horijon Polli, a densely-populated slum in Bangladesh that is home to approximately 6,000 people. Oxfam is working with partners there to improve public health facilities, rebuilding toilets and sanitation systems as well as building new bathing blocks. 

For people like Munni, the effects of inequality are felt on a daily basis. Munni works incredibly hard every day to make ends meet – as a cleaner in a company and then again in a local government office.

And yet still she dreams of job security: “I call my job a “one/two job”. One: today I have it. Two: tomorrow I don’t.”

Help make change happen for people like Munni. Take action today.

Oxfam Ireland's tax justice project is funded by the European Union

#PanamaPapers: Death and taxes

The only two certainties we have are death and taxes, so the saying goes.

The Panama Papers released this week by the ICIJ show the enormous lengths people will go to in order to evade or avoid paying taxes. But they don’t show the serious impact of such actions — which can literally mean death for some.

A story which emerged from Cameroon last month illustrates this in the most tragic way. Monique Koumate (31) was expecting twins. Her partner took her to hospital when she went into labour and started experiencing complications. But because they didn’t have the money to pay the fees required, she was reportedly left outside the maternity unit in the city of Douala for hours, in desperate need of urgent care, the door closed to her.

Top-left:Front page reports from Cameroon of Monique Koumate's tragic death. "Lanquinitinie Hospital: Horrifying!",  "Woman, twins abandoned to die during delivery". Top-right: People in Cameroon took to social media to pay their respects and express their horror at Monique's death. Botom: Protestors hold banners saying "Never again a Monique Koumate in my country!" Photo credits, clockwise from top: 237online.com, CulturEbene, Simonoteba.com, TheObserveres.France24.com, CameroonOnline.org, camer.be/obesso.net. 

Monique’s family did their best to help her — a graphic video shows a woman reported to be her niece trying to perform a caesarean section using a knife — but one twin was stillborn and the other died moments after birth. Monique also died on the steps of the maternity unit — three lives lost feet away from the medical attention they needed but could not afford.

Cameroon has a severe shortage of doctors, just one for every 5,000 people. The government introduced a fee-based system for healthcare in a bid to bridge a funding gap and make services more widely available.

Illicit financial flows out of Cameroon are 63% of the country’s health budget and the equivalent of its entire foreign direct investment and aid each year.

VIDEO: PROTEST FOR MONIQUE KOUMATE, MARCH 13 2016

MANIFESTATION A LAQUINTINIE

MANIFESTATION DEVANT L'HOPITAL LAQUINTINIESE TAIRE, NE RIEN FAIRE, ETRE NEUTRE EST PIRE QUE CRIMINEL!RAPPEL DES FAITS:Une femme qui décède devant un hôpital faute de moyen. Arrivée à l’hôpital les médecins refusent de la prendre en charge parce qu'elle n'a pas d'argent.. Chose surprenante ce sont ses soeur qui ouvrent son ventre avec une lame rasoir pour essayer de sauver les bébés. Quel images pour le Cameroun .Les bébés sont-ils vivant ? ......Malheureusement aux dernières nouvelles ils ont aussi perdus la vie grâce à ceux qui ont prêter serment de sauver des vies humaines. .Que c'est pathétique pour les hôpitaux du CamerounQuel sadisme et méchanceté au point de laissé mourir 02 bébés innocent. ..Une plainte doit être déposer contre cette instance criminelle sur cet acte de non assistance à personnes en danger et de plus pire encore des bébés. ..Que la communauté internationale sur le programme de la santé saisisse cet affaire qui ne doit rester sans suite afin que justice soit faite pour ces bébés innocent. ..ceci pour en sauver d'autres qui peuvent subir le même sortMAINTENANT PLACE A LA MANIPULATION :Faites Attention! Les agents de manipulation de l’opinion nationale et internationale sont deja en marche. Une premiere tentative de manipulation qu’ils essayent de faire passer est de dire que Monique et ses bebe étaient deja décédés avant d’arriver a Laquintinie (Dites meme qu’ils sont morts 4 jours avant). Une autre tentative de manipulation veut faire croire q l’opinion que la courageuse soeur de monique serait l principale responsable du drame ceci juste pour dédouaner les médecins et infirmiers principaux responsables de ce drame.

Posted by Vert Rouge Jaune on Sunday, March 13, 2016

The day after the video of Monique Koumate's death was published, several hundred people gathered in front of the hospital where she died to protest at Cameroon’s failing healthcare system. Source: Vert Rougue Jaune/Facebook

Every single year, poor countries lose around €150bn/£119bn due to tax dodging by wealthy individuals and companies. This is money that should be used to fund schools, hospitals, homes and infrastructure.

INEQUALITY IS OUT OF CONTROL

It’s part of the bigger and growing problem of economic inequality. An Oxfam report published in January showed that just 62 people own as much net wealth as the poorer half the world’s population — approximately €1.62tn/£1.25tn.

Think about that for a moment: the number of people who could probably comfortably fit inside your local pub, own as much as 3.6bn people do.

Our economic system is skewed in favour of the wealthiest. Far from trickling down, income and wealth are instead being sucked upwards at an alarming rate.

One of the trends underlying this concentration of wealth and income is the return to capital versus labour. In almost all rich countries and in most developing countries, the share of national income going to workers has been falling. This means workers are capturing less and less of the gains from growth.

In contrast, the owners of capital have seen it consistently grow (through interest payments, dividends, or retained profits) faster than the rate the economy has been growing.

Tax avoidance by the owners of capital, and governments reducing taxes on capital gains, have further added to these returns.

Thanks to the recent revelations and previous investigations such as Lux Leaks, public awareness — and frustration — has increased dramatically. Ahead of the Irish general election in March, an Oxfam Ireland survey conducted nationwide found that 82% of people agreed that measures to specifically address tax-dodging needed to be a priority for the incoming government and Taoiseach.

The survey also showed growing concern in relation to large-scale tax dodging with 86% of Irish people holding the belief that big companies and wealthy individuals are using tax loopholes to dodge paying their fair share.

All governments, rich and poor, have to work together to tackle the inequality so clearly illustrated by the Panama Papers because it is their citizens who are the biggest losers. They need to fix the system and penalise banks and any others who facilitate tax-dodging.

Real transparency is needed — establishing public registers of the beneficial owners of all companies, foundations and trusts (so governments know who really owns and benefits from them and can tax them accordingly).

We also need to know where companies really make their profits and where they are paying their taxes. This would allow countries to fairly tax multinationals where their profits are. To achieve this, a simple solution is on the table.

Country-by-country reporting, as it is called in tax jargon, would require multinational companies to publish this information. Some countries, including Ireland, say they’ll implement it, but the information won’t be made public.

This is a crucial flaw — because if the information remains confidential between tax authorities, the public and civil society won’t be able to hold multinationals to account for their tax practices — and developing countries won’t be able to scrutinise the global tax arrangements of multinationals in their territory.

As political leaders in Ireland continue to engage in discussions on government formation, the measures Ireland can take to assist in the reform of the global tax system should be part of the agreement of any progressive Programme for Government. The human cost of doing anything else is simply too high.

Jim Clarken is Chief Executive of Oxfam Ireland. This article was first published by The Irish Examiner.

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