Press Releases

Corporations continue to shift billions in profit to and through Ireland to avoid tax

Tax loopholes cost Irish taxpayer hundreds of millions each year – new Oxfam Ireland report

Tuesday February 28th, 2017

Government measures aimed at tackling tax avoidance are falling short as tens of billions of euro of corporate profits continue to be shifted to and through Ireland each year to avail of Ireland’s lax tax system, a new report by Oxfam Ireland shows.

Launched today, Mantras and Myths: A True Picture of the Corporate Tax System in Ireland, says Ireland’s extensive network of legal double taxation agreements could allow companies to continue to route profits to low tax jurisdictions beyond the 2020 end date of the ‘Double Irish’ loophole. A corporation can simply establish an Irish-registered company which is tax resident in a country with which Ireland has a double tax arrangement, such as Qatar or Panama.

The report highlights the potential negative impact of Ireland’s corporate tax system on developing countries and how its lack of full transparency leaves them and the Irish public in the dark about where companies make their profits and pay tax. Despite recent changes to Ireland’s double taxation treaties with developing countries, most contain no anti-abuse provisions aimed at preventing tax avoidance. The UN, World Bank, IMF and OECD recommend that all such treaties with developing countries should include anti-abuse provisions.

Oxfam Ireland Chief Executive Jim Clarken said: “Corporate tax dodging is not a victimless crime. Not only does Ireland harm its own reputation by allowing such practices, but profits that flow through Ireland without being taxed here should have been taxed elsewhere.

“The European Commission’s Apple ruling provided a rare glimpse into a secretive world. It showed that Apple routed two-thirds of its profits on global sales, including in Africa, through Ireland, resulting in no tax accruing to relevant developing countries. Africa has a bigger mobile phone market than the US and will shortly surpass Europe but African tax revenues are not benefiting from this boom.

“Globally, an estimated $100 billion is lost to developing countries every year because of corporate tax avoidance schemes. This denies the world’s poorest places the additional resources that would make a huge difference by providing the schools, hospitals and infrastructure that lift people out of poverty.”

Elsewhere, the report estimates that incentives and tax relief for the aircraft leasing industry cost the Irish taxpayer approximately €577m in foregone corporate taxes every year. It also references a 2016 study by Oxfam and other NGOs which found that French banks reported €272 million in profit in Ireland – completely out of proportion to their reported turnover and number of employees in Ireland. For example, for the same turnover, Société Générale recorded profits in Ireland which were proportionately 18 times higher than in other countries and 76 times higher than in France.

The report acknowledges the reforms made by the Irish Government to date, including through the OECD Base Erosion and Profit Shifting (BEPS) process and others at EU level to address tax avoidance. However, Oxfam says it has serious concerns about whether the existing processes Ireland is engaged in go far enough and warns that BEPS will ultimately fall short in its efforts to tackle the global nature of corporate tax avoidance because of its limited scope and membership and its exclusion of developing countries from the start of the process.

Mr. Clarken said: “We need to have an honest discussion about corporate tax avoidance in Ireland and be prepared to admit that while we’ve made a good start, there is still a secretive network of loopholes to be exposed and removed if harmful. Despite some improvements, reporting requirements for multinational corporations’ tax activities are still opaque.

“We believe that ensuring Ireland’s prosperity and making our tax system fair and transparent isn’t mutually exclusive. The Irish Government has repeatedly said there should be no conflict between growing your economy and doing what is right. Ultimately, corporate tax dodging will be ended by a concerted global effort and we believe Ireland can play a positive role in ensuring this reform happens,” he added.

“Changing geo-political conditions mean Ireland must fully engage at an international level to stem the negative effects of corporate tax avoidance. This report sets out the practical solutions, from strengthening tax rules that remain open to abuse to supporting the establishment of an international tax body. Otherwise, citizens here in Ireland and in developing countries will pay the price.”

Among the report’s recommendations, Oxfam Ireland is calling on the Government to do the following:

·         Support efforts at the EU to agree meaningful legislation to ensure that multinationals publically report on a country by country basis where they make their profits and pay their taxes

·         Tackle profit-shifting by revising Ireland’s weak transfer pricing (the way in which the transfer of goods and services between subsidiaries of the same group of companies are accounted for) legislation and give Irish revenue officials the authority to investigate instances where profit-shifting may be used as a tax avoidance strategy

·         Re-examine Ireland’s network of double taxation agreements to ensure that companies cannot avail of tax structures similar to the ‘Double Irish’ post-2020.

·         Legislate in the next Budget for strong Controlled Foreign Company Rules to discourage profit shifting to tax havens outside the EU as agreed to under the EU Anti-Tax Avoidance Directive

·         Commission a new spillover analysis to improve understanding of financial flows between Ireland and developing countries via third countries using data that will become available to Ireland through exchange of information protocols agreed as part of the BEPS process

·         Support the formation of a global tax body to ensure an international tax system which considers the interests of developed and developing countries equally. 

Oxfam Ireland will host a panel discussion: ‘Corporate tax reform: Has Ireland done enough?’ tonight which will include contributions by tax activists from Kenya and Nigeria. The event takes place at the Dublin’s Royal Irish Academy at 6pm. 

To read the full report, click here: https://www.oxfamireland.org/sites/default/files/upload/pdfs/mantras-myths-final.pdf

To read the summary, click here: https://www.oxfamireland.org/sites/default/files/upload/pdfs/mantras-myths-summary.pdf

For information about tonight’s event and speakers, see https://www.facebook.com/events/2218493718376656/

ENDS

Contact: Sorcha Nic Mhathúna, Oxfam Ireland, +353 83 1975 107, sorcha.nicmhathuna@oxfamireland.org

 

Notes to Editor:

The report and event are part of Oxfam Ireland’s Make Tax Fair campaign. This project is funded by the European Union.

Double taxation agreements: Double taxation agreements are legal arrangements between jurisdictions to determine the taxing of cross-border activities.

Profit-shifting in Ireland: Oxfam’s ‘Tax Battles’ report in December 2016 found the level of excess profits (profits over and above what one might normally expect based on real economic activity) reported in Ireland to be in the tens of billions, while a 2015 research report published by the International Centre for Tax and Development estimated that excess profits in Ireland could be as high as $93 billion.

https://www.oxfam.org/en/research/tax-battles-dangerous-global-race-bottom-corporate-tax

Corporate tax dodging and developing countries: The UN has estimated that developing countries lose around $100bn annually as a result of corporate tax avoidance schemes. http://unctad.org/en/PublicationsLibrary/wir2015_en.pdf

Oxfam calculates that this is enough to pay for the education for all of the 124 million children currently out of school, and to pay for health interventions that could save the lives of four million children. The total annual financing gap to achieve universal pre-primary, primary and secondary is $39 billion each year, while the number of children out of school is 124 million (59 million young children, 65 million adolescents) according to UNESCO. http://unesdoc.unesco.org/images/0024/002457/245745e.pdf

http://www.uis.unesco.org/Education/Pages/oosc-data-release-2015.aspx

$32bn would fund the key healthcare to save the lives of six million children across the world each year. http://www.thelancet.com/pdfs/journals/lancet/PIIS0140-6736(13)62231-X.pdf

Calculation on Ireland’s aircraft leasing industry: In answer to a Parliamentary Question, Minister for Finance Michael Noonan revealed that in 2014 the Irish aircraft leasing business as a whole paid less than €23 million in corporate tax. According to the IDA, the aircraft leasing industry manages more than €100 billion in assets. While we do not have profit figures, industry observers suggest that return on investment in aircraft leasing can be between 3 and 15 percent. If we suppose, for example, a 5 percent return on those assets, then profits would be in the region of €5 billion, which, taxed at 12.5 percent, would give us €600 million in corporate tax. This would mean that incentives and tax relief for the aircraft leasing industry cost the Irish taxpayer approximately €577m in foregone corporate taxes every year. (See p17-18 of the report for additional detail).

French banks research: A study by Oxfam and other NGOs in 2016 found that French banks reported €272 million in profit in Ireland – completely out of proportion to their reported turnover and number of employees in Ireland. For example, for the same turnover, Société Générale recorded profits in Ireland which were proportionately 18 times higher than in other countries and 76 times higher than in France. This was calculated by comparing two ratios – (i) the amount of profit Société Générale made in Ireland divided by its turnover in Ireland, and (ii) the aggregated profit it makes in other countries divided by the aggregated turnover in these countries. The 2016 report Following the Money: French Banks’ Activities in Tax Havens is available at https://www.oxfam.org/sites/www.oxfam.org/files/following_the_money_final_english.pdf

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Oxfam Media Planning Calendar February – April 2017

Please find below and attached our calendar of media stories and reports for the next few months. Do get in touch if you’d like any more information: contact Alice Dawson on +353 (0) 83 198 1869 or at alice.dawson@oxfamireland.org and for breaking stories, follow us on twitter: @Media_OxfamIRL and @OxfamIreland and via the media section of our website at www.oxfamireland.org/blog/press-releases

February

Breaking emergencies: We anticipate our humanitarian work over the next few months will focus on the developing food crises in South Sudan, where famine has been declared; in northern Nigeria, where it is likely that some 400,000 people living in areas cut off from aid are already suffering famine; and also Somalia and Yemen, which both currently stand on the brink of famine. Millions of vulnerable people across these regions are affected by ongoing conflicts and are facing starvation, with Oxfam supporting with life-saving food, water and sanitation.

Monday 27 February: ‘The Taxing Question – Would changing our corporate tax system do more harm than good?’ Oxfam Ireland hosts a panel discussion at the MAC in Belfast at 6pm on Monday 27 February, looking at the global and domestic impact of potential changes to Northern Ireland’s tax system. Chaired by Yvette Shapiro, speakers will include Oxfam Ireland CEO Jim Clarken; UU economist Philip McDonagh; Patricia McKeown, regional secretary of UNISON and Wanjiru Kanyiha, a tax justice activist from Kenya.

Tuesday 28 February: ‘Mantras and Myths: A true picture of the corporate tax system in Ireland’. Publication launch of a new review of Ireland’s corporate tax system, commissioned by Oxfam Ireland. There will be a photocall at 10.30am at Leinster House (Kildare St side) with visiting tax activists and Oxfam Ireland campaigners, followed by a panel discussion hosted by Oxfam Ireland at the Royal Irish Academy (RIA), 19 Dawson Street, Dublin 2, 6pm on Tuesday 28th of February 2017. Chaired by RTE's Conor Brophy, speakers will include Oxfam Ireland CEO Jim Clarken; Wanjiru Kanyiha, a tax justice activist from Kenya; Feargal O’Rourke, Managing Partner, PWC; and Mary Cosgrove, Lecturer at NUI Galway.

Date tbc: Oxfam publishes research on the thousands of boys and men missing from communities caught up in conflict with Boko Haram and military operations to counter them. More than nine million people in Nigeria, Niger, Chad and Cameroon are in desperate need of emergency aid and there are alarming levels of human rights abuses and forced recruitment of young children.

Date tbc: Oxfam publishes report on rules around refugees reuniting with family in the UK.

March

Thursday 2 March: Women, Work and Wages: Oxfam launches a new report on women's inequality at work ahead of International Women’s Day.

Early March – Balkans deportations report: Oxfam partners on the Balkans have interviewed refugees and other migrants in Serbia and Macedonia to hear about their experience with illegal deportations along the Balkans route.

Wednesday 8 March: International Women's Day.

Wednesday 8 March: UK Chancellor’s Spring Budget. Oxfam spokespeople available for comment on the impact of policies affecting poverty in the UK and abroad.

Monday 13 - Thursday 16 March – European Parliament vote on asylum reform: Oxfam spokespeople available for comment

Wednesday 15 March: Sixth anniversary of the start of the war in Syria. Oxfam spokespeople will be available for comment on how Syrian refugees have ever fewer options for where to go.

Wednesday 15 March: Tax justice: judgement expected in LuxLeaks Whistleblowers re-trial.

Friday 17 – Saturday 18 March: G20 Finance Ministers’ Meeting, Baden-Baden. Oxfam spokespeople available for comment on the impact of tax and economic policies on fighting poverty.

Wednesday 22 March: World Water Day. Around the world, Oxfam is helping to keep millions of people healthy when disaster strikes by providing clean water and toilets. Photo case studies available.

Thursday 23 March: Oxfam launches research into tax practices of European banks – their use of tax havens and how they facilitate tax dodging.

Date tbc: Oxfam publishes report on the use of water as a weapon of war in Syria.

April

Early April: OECD publishes annual overseas aid spending figures. Oxfam spokespeople available for comment on how UK aid is helping to raise living standards for the world’s poorest people.

Monday 17 April: Iraq – six months since the start of the offensive to retake Mosul from ISIS. Oxfam is supporting thousands of people affected by the conflict, providing clean water, shelter and toilets. Oxfam spokespeople available.

Friday 21 – Sunday 23 April: World Bank Spring Meetings, Washington. Finance leaders and politicians will discuss the global economy, poverty eradication and aid effectiveness. Oxfam spokespeople available to comment.

ENDS

Please note we can also provide spokespeople in Ireland, north and south, and across the world on a wide range of subjects, including:

  • The global refugee crisis and Oxfam Ireland’s Right to Refuge campaign in support of vulnerable people escaping conflict
  • Humanitarian crises including South Sudan, north east Nigeria, Yemen, Syria, Iraq, Central African Republic and Democratic Republic of Congo, plus breaking stories (Oxfam specialises in providing safe water and sanitation in emergencies)
  • Economic inequality including the human cost of large-scale tax dodging by corporations and wealthy individuals (Even it Up and Make Tax Fair campaigns)
  • Women’s rights including gender-based violence, gender pay gap and female entrepreneurship

CONTACT:

Dublin:

Alice Dawson, +353 83 198 1869, alice.dawson@oxfamireland.org
Sorcha Nic Mhathúna, +353 83 1975 107, sorcha.nicmhathuna@oxfamireland.org

Belfast:
Phillip Graham, +44 7841 102535, phillip.graham@oxfamireland.org

Follow us on Facebook at www.facebook.com/oxfamireland or on Twitter @Media_OxfamIRL or @OxfamIreland

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Threat of four famines in 2017 “a catastrophic betrayal of our common humanity”

Oxfam calls for immediate humanitarian and political action


Friday 24 February 2017 

The world stands on the brink of an unprecedented four famines in 2017 due to a catastrophic failure of the global community to uphold its obligations to the most vulnerable of people, Oxfam has said. 

The aid agency is calling on the international community including Ireland to take immediate action to help as many as 20 million people now at risk of starvation in South Sudan, Nigeria, Yemen and the Horn of Africa. 


After months of early warnings, famine was declared this week in parts of South Sudan. In northern Nigeria it is likely that some 400,000 people living in areas cut off from aid are already suffering famine. Both Yemen and Somalia stand on the brink. The primary driver of these crises is conflict, though in Somalia it is drought. 

Donor countries have failed to adequately support efforts to resolve these conflicts and, in Yemen, are actually fuelling the conflict through arms sales. There is now urgent humanitarian need, as well as a moral obligation, to meet the $4.4 billion needed for the aid response for these crises at the required scale.

Oxfam Ireland’s Chief Executive Jim Clarken said: “Famine does not arrive suddenly or unexpectedly. It comes after months of procrastination and ignored warnings. It is a slow agonising process, driven by callous national politics and international indifference. It is the ultimate betrayal of our common humanity. 

“The response by many donors to ever bigger UN appeals for humanitarian funding have fallen well below what is required and short-changed the aid effort to save people’s lives. Without urgent action by the international community, these crises will only deepen in the coming months. This cannot continue. Governments need to act now to fully fund the aid effort and Ireland, with our own experience of famine, is uniquely positioned to lead an urgent call to action at UN and EU levels. 


“The famine already gripping parts of South Sudan will spread across the country if not more is done. Famine may be imminent in Somalia, Yemen and Nigeria but it is not yet inevitable. If we act collectively now with a massive injection of aid, backed with diplomatic clout driven by the imperative to save lives, we can prevent a catastrophic loss of life. As a hunger crisis unfolds, malnutrition and mortality rates rise exponentially, rather than steadily. Without an urgent injection of financial support, an already stretched international humanitarian system will not be able to cope and many more people will die.”


Oxfam is calling for the rapid and increased release of humanitarian funding to save lives and prevent these crises exacerbating further. It also urging for increased diplomatic efforts to convene ceasefires, enable safe passage by those fleeing insecurity and secure access by aid agencies to those in need of assistance.


In Somalia, 2.9 million people face acute food security ‘crisis’ and ‘emergency’ levels. This could tip into famine if the April-June rains fail, their ability to buy food declines and people do not receive humanitarian support. 

In Nigeria, over 5 million people are in food crisis, and this is projected to reach 5.7 million by June 2017. There is a strong likelihood that at least 400,000 people could already be experiencing famine-like conditions and that this could rise to up to 800,000 over the course of 2017 if humanitarian assistance cannot be delivered.  

In South Sudan, 100,000 people are facing starvation now and a further 1 million people are classified as being on the brink of famine in Unity State. 

In Yemen, over 7 million people are just one step away from famine, and an extra 10 million people are severely hungry. This is largest hunger emergency in the world. The UN’s Food and Agriculture Organisation is reporting that wheat stocks for the country will run out in April.   

Oxfam is already helping over a million people in Yemen, more than 600,000 in South Sudan, over 200,000 in Nigeria and an assessment mission has just returned from northern Somalia where it plans to begin a response to the drought. 

Oxfam Ireland has a hunger crisis appeal at www.oxfamireland.org/hunger 

ENDS


Contact: Sorcha Nic Mhathúna, Oxfam Ireland, 083 1975 107, sorcha.nicmhathuna@oxfamireland.org

Oxfam warns of a race against time, as famine declared in parts of South Sudan

20 Febuary 2017

As the UN and the government of South Sudan have today declared famine in parts of the war-torn country, Oxfam is warning that time is running out.

This is the UN’s first confirmation of famine anywhere in the world since 2011.

Unity State is the region most affected by severe food shortages – caused by ongoing conflict and economic turmoil – with more than 100,000 people facing starvation. Reports suggest that more than 40% of South Sudan is in urgent need of food, while more than a million people throughout the country could be on the brink of famine.

Oxfam has been working there for over 30 years and is currently distributing emergency food supplies; delivering clean water to prevent the spread of disease; and providing livelihoods support. In the past year alone, Oxfam has helped over 600,000 people across the country with food and water distributions, and assisted almost 40,000 of the most vulnerable in Panyijar county, Unity State.

Oxfam Ireland Chief Executive Jim Clarken, who has lived and worked in the region, said: “This is a man-made tragedy, and we are running out of time to avoid it getting worse. 

“In over 30 years working in the affected areas, Oxfam has never witnessed such dire need. Vulnerable people, out of reach of life-saving assistance due to the conflict, are paying the ultimate price. People have been pushed to the brink of surviving on what they can find to eat in swamps. As so often in a crisis, women and children being the worst affected. We need an end to the fighting so that we can get food to those that urgently need it and provide them with support to rebuild their shattered lives”. 

“In 2011 after the famine that hit Somalia the world said never again. The declaration of famine in South Sudan reflects the collective failure to heed the countless warnings of an ever-worsening situation”. 

ENDS 

For further information or to arrange an interview: 

Phillip Graham – T: 00 44 7841 102535 / phillip.graham@oxfamireland.org 

NOTES TO THE EDITOR 

About South Sudan

Following decades of fighting, South Sudan formally became an independent state in July 2011. There was high expectation for growth and many believed they would not see another conflict in the country they fought so hard and so long for. Sadly, war erupted in Juba in mid-December 2013 and quickly transformed into a national, political and ethnic crisis. 

Since then, more than 2.5 million people have been displaced. Of these 830,000 have fled to neighbouring countries, mainly Ethiopia, Kenya, Sudan and Uganda. The crisis has made it hard for people to plant crops, disrupted livelihoods and markets and forced host and displaced communities to share the little they do have, leaving one in three people severely food insecure.

Oxfam has been assisting populations in South Sudan since the 1980s providing food security and water, sanitation and hygiene assistance. 

Spokespeople 

Oxfam spokespeople are available for interview now, both in the region and in Ireland:

Emma Jane Drew, Oxfam’s Humanitarian Programme Manager, based in Juba, South Sudan 

Oxfam Ireland Humanitarian Manager Colm Byrne has visited Oxfam programmes in South Sudan numerous times and is available for interview in Dublin.

Oxfam Ireland Chief Executive Jim Clarken, who lived and worked in the region, is available for interview in Dublin.

 

Oxfam Ireland and GOAL explore merger

Tuesday 14th February, 2017

Oxfam Ireland is entering formal discussions with GOAL on a potential merger that, if successful, will see the organisations coming together under the name Oxfam GOAL to create a global development agency headquartered and rooted in Ireland, delivering a broad programme combining humanitarian and development work with evidence-based advocacy and campaigns.

The announcement follows approval from the boards of both organisations to explore the possibility of a merger which both parties believe could achieve stronger results, save more lives and support more people to lift themselves out of poverty.

GOAL and Oxfam Ireland believe a successful merger would result in greater impact for people in poverty and crisis and increase effectiveness. Coming together will increase the scale and scope of the organisations’ humanitarian and development programmes around the world and strengthen their voice as advocates for the communities they support.

Oxfam Ireland Chief Executive Jim Clarken said: “We are very excited by the prospect of a successful merger. GOAL’s action-oriented approach and first responder ethos is core to their DNA and has saved millions of lives. Oxfam’s approach of practical action and people-led response, challenging the structures and systems that keep people locked in poverty, has led to real change across the world. Bringing our organisations together will increase our scale, which means we can deliver greater impact for people in poverty and in crisis. We believe it will create new energy and dynamism through sharing programmatic, geographic and other synergies.”

Commenting on the proposed merger, GOAL General Manager, Celine Fitzgerald said: “In looking to its future, GOAL has assessed the merits of continuing as a standalone entity or achieving a step change in scale and impact in the delivery of humanitarian support and advocacy.  A merger with Oxfam would create a strong organisation in Ireland with a true global reach, saving and changing the lives of millions of the poorest and most vulnerable people on our planet for the better.  Accordingly, both parties have now engaged in a formal process to assess the practicalities and impacts of a merged entity.”

GOAL and Oxfam already share key areas of focus and work in many of the same countries.

Both organisations have long-standing operations in Ireland – Oxfam since the 1950s, while GOAL celebrates its 40th anniversary this year. Following a successful merger, the new organisation will remain part of the global Oxfam confederation, which currently has 19 affiliates and works in over 90 countries.

Pending the outcome of formal discussions both organisations will continue to deliver their respective aid programmes whilst also assessing how to combine the best of both organisations to increase the overall reach and impact of resources and programmes. 

“As we begin a robust due diligence exercise and examine the possibility of a merger over the coming weeks, I’d like to assure our donors and supporters that we will continue with our life-saving and life-changing work as normal. Any partnership with GOAL will retain and respect both of our unique heritages to create a better organisation rooted in the Irish tradition of social justice,” Mr Clarken added.

ENDS

Contact:

Sorcha Nic Mhathúna, Oxfam Ireland, +353 83 1975 107, sorcha.nicmhathuna@oxfamireland.org
David Williams, GOAL, +353 87 419 7140, dwilliams@goal.ie

Notes to editors:

About Oxfam: The global Oxfam confederation has 19 affiliate members and works in over 90 countries. Oxfam was founded in 1942 to campaign for food supplies to be sent through an allied naval blockade to starving people in Greece during the Second World War.

Present in Ireland since the 1950s, Oxfam Ireland is a secular organisation with offices in Dublin and Belfast and shops across the island, supported by over 2,000 volunteers and 136 staff.

As well as being a world leader in the delivery of emergency relief, Oxfam implements long-term development programmes in vulnerable communities. Oxfam also campaigns on global issues that keep people poor or hit poor people hardest, like inequality and discrimination against women and to demand better health and education services for all.

There are 19 member organisations of the Oxfam International confederation. They are based in Australia, Belgium, Canada, Denmark, France, Germany, Great Britain, Hong Kong, Ireland, India, Italy, Japan, Mexico, the Netherlands, New Zealand, Quebec, South Africa, Spain and the United States.

About GOAL: GOAL is an international humanitarian agency dedicated to the alleviation of suffering amongst the poorest of the poor. It was founded in 1977.

GOAL has almost 3,000 staff working across 17 countries. In the year ending December 2015, GOAL’s total income exceeded €209m, while total expenditure was €201 million.

Since its inception, GOAL has sent almost 3,000 international staff to work in the developing world, alongside many thousands of local staff. It has spent in excess of €1 billion on the delivery of aid to the poor in more than 50 countries.

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