- 3 min read
- Published: 31st October 2017
A third of tax dodged in poor countries enough to prevent 8m deaths a year, new Oxfam study reveals
Just a third of the $100bn [approx. €86bn/£78bn] tax that companies dodge in poor countries annually is enough to cover the bill for essential healthcare that could prevent the needless deaths of eight million mothers, babies and children, Oxfam revealed today as it launched a hard-hitting film illustrating the human cost of tax avoidance on the world’s poorest.
Experts estimate that $30bn [approx. €25.8bn/£23bn] is needed each year to pay for basic healthcare such as vaccinations, midwives and diarrhoea treatment that could prevent an average of 7.8m children and 210,000 women dying in 74 countries with large numbers of people living in poverty.
Jim Clarken, Oxfam Ireland’s Chief Executive, said: “Tax dodgers may not be literally stealing medicines from the pockets of the poorest but they are depriving poor countries of billions that could be invested in healthcare.
“Oxfam works in some of the poorest countries in the world and sees the impacts of tax dodging every day. For instance, we work in Tanzania which has an annual health budget of just €17 per person. Every medicine that is not bought for the lack of government funds due to tax dodging affects thousands of men, women and children across the world.
“While corporate tax avoidance strips developing countries of vital funds needed for hospitals, millions of the world’s poorest people are missing out on basic medical treatment that could save their lives and help them escape hardship. There can be no excuse for delaying tough action against tax dodging.
“As the EU tax transparency process is at a standstill, the Irish and UK governments should lead the way in helping to ensure companies pay their fair share of taxes everywhere they do business.
“Ireland should agree legislation with its EU partners to ensure that multinationals publically report on a country by country basis where they make their profits and pay their taxes.
“Making this information public will give both policy makers and the public the opportunity to understand how a country’s corporate tax system is actually operating, and provide them with the information to review and change it.
Oxfam is urging the UK Chancellor Phillip Hammond to use next month’s Budget to commit to implementing tougher tax laws for British multinationals, including those that operate in developing countries, by the end of 2019. As movement towards an EU tax transparency deal has stalled, it is calling on him to push ahead and build on the leadership some UK companies have already shown.
More than a year since the Government passed legislation to enable the introduction of comprehensive public country by country reporting for UK-based companies and nearly two years since the last Conservative government agreed the case had been made for the change, it is still no closer to being a reality.
Poor countries are twice as dependent as rich countries on corporate tax revenue as a proportion of the money they have available to buy medicines, pay nurses and pipe clean water to people’s homes. There is evidence to show that when poor countries increase their tax revenue – in particular from corporate and income tax – they spend more on healthcare, leading to healthier populations.
Greater tax transparency would make it easier to verify whether companies’ tax bills are in line with their real economic activity in every country where they do business – and to hold them to account if not.
However, until these public reporting requirements are mandatory for all large businesses, widespread tax avoidance will continue to deprive governments rich and poor of revenue needed to provide essential services and tackle poverty.
ENDS
For more information or interviews please contact Phillip Graham on 00 44 (0) 7841 102535 / phillip.graham@oxfamireland.org
