Budget 2014 a step in right direction for a fairer global tax system

Oxfam has long campaigned for a more equitable tax system that would see ordinary people at home and in developing countries get a fairer deal. We have called on governments to share more information about who owns what and where, along with tightening the loopholes that allow vast amounts of taxable money belonging to wealthy individuals and companies to slip through the net. 

Key to this is greater information sharing and transparency between countries, such as the commitment to global automatic exchange of tax information supported by the new Irish International Tax Strategy unveiled in today’s Budget 2014. Minister Noonan's comments about Ireland being ‘part of the solution to a global tax challenge’ and the publication of the Irish International Tax Strategy are steps in the right direction – provided it is now followed by decisive action putting an end to tax dodging which hurts people at home and in developing countries.

Making sure wealthy individuals and companies pay their fair share of tax would help eradicate the pervasive inequalities in a world where one in eight people still go to bed hungry every night. This hidden money could provide urgent finance for essential public services like health and education both at home and in poor countries.

Above: Ashma Turay and her four-day-old daughter at a vaccination clinic in Ghana. Increased tax transparency would mean that money currently hidden from tax authorities could raise vital revenue for essential public services like health and education both at home in Ireland and in developing countries. Photo: Aubrey Wade/Oxfam

The Government’s commitments to efforts at OECD and EU level to develop a response to aggressive tax planning, along with planned legislation that includes a change to company residence rules to prevent companies from being ‘stateless’ are to be welcomed, though we await more details.

It is vital that poor countries are not left behind in tax reform. The strategy announced today commits Ireland to supporting developing countries to raise their own domestic revenue in ways that are more efficient. This promotion of trade and development will help countries to lift themselves out of extreme poverty, provided these activities are guided by the Principles of Good Humanitarian Donorship and similar principles that maintain a respect for human rights.