The G20 must take necessary steps to reform the international taxation system to stop wealthy tax dodgers, beginning at its Finance Ministers and Central Bank Governors meeting this weekend (22-23 Feb) in
As a result, this year's G20 will be judged on how it tackles tax avoidance, promotes international tax transparency and ensures that developing countries benefit from the changes, particularly in relation to information sharing. "As the G20 host,
Tackling tax avoidance
"The international tax regime is broken. This is contributing to widening income inequality and the scandal that we see today of the 85 richest people owning the same wealth as half the world's population," she said. "Rich corporations and individuals cannot be allowed to keep squirrelling their profits away in tax havens in order to dodge their tax responsibilities."
"This combination of tax avoidance and low tax rates facilitates the illicit flow of huge amounts of capital from the world's poorest countries. Between 2008 and 2010, sub-Saharan Africa lost on average
G20 finance ministers must make progress towards better-functioning domestic and international tax systems. These systems are vital for both rich countries to strengthen their economies, and developing countries to help them achieve sustainable economic and human development.
Involving developing countries
"The only way to ensure that developing countries will benefit from these tax reforms is to involve them in the process from Day One," Dr. Szoke said. "That is why, this weekend, we want to see G20 Finance Ministers agree on a process that will allow all developing countries to participate in the OECD-led Base Erosion and Profit Shifting (BEPS) project."
BEPS seeks to crack down on companies that declare their profits in low-taxing countries and their losses in high-taxing ones, in order to wriggle out of their tax liabilities.
"Reforming the international tax regime and increasing transparency will not only help lift people out of poverty and reduce dependency on aid, but will help the G20 achieve its aims this year for stronger economic growth and employment," Dr. Szoke said.
Most Popular Stories
- Obama Administration Releases Proposal to Regulate For-Profit Colleges
- Apple, HP, Intel May Take a Hit from Slowdown in Smartphone Sales Growth
- FDIC Files Lawsuit on Behalf of Banks Allegedly Hurt by Libor Scandal
- Some California Cities Seeking Water Independence
- SoCalGas Reaches Record Spend on Diversity Suppliers
- Motley Crue's Nikki Sixx Marries Model Courtney Bingham
- Chinese e-Commerce Giant Alibaba Gears for IPO in U.S.
- Will Missing Malaysian Jet Prompt Aviation System Change?
- GM Recall Poses First Major Test for New CEO
- Obama Seeks to Stay Neutral in CIA-Senate Conflict