Thursday, June 6, 2013

USA Africa Dialogue Series - Who pays the price? Hunger: the hidden cost of tax injustice

Christian Aid estimates that businesses that benefit from lack of transparency in trade and financial systems also plays a role in exacerbating hunger: they deprive the poorer countries of some €124 billion ($160 billion) in tax revenues every year – far more than such countries receive in aid.

This report is oriented towards supporting the main UK/G8 tax policy asks of the UK's IF Campaign on hunger. It proposes that tackling tax dodging and ending financial secrecy could provide the €39 billion ($50 billion) the Food and Agriculture Organization of the United Nations (FAO) estimates is needed every year to eradicate hunger by 2025.

Christian Aid makes the link between tax dodging, financial secrecy and hunger. It includes three country case studies to reinforce the claim that tax justice is essential to combat hunger: Ghana, India and El Salvador. There they identify measures that could be adopted by governments in these countries to increase tax revenues, reduce inequality and tackle hunger.

The report also contains two new pieces of research that support the findings with evidence:

  • The first piece of research featured in the report focuses on an Orbis-based research conducted on more than 1,500 Multi-National Corporations(MNCs) operating in India and finds that MNCs with links to tax havens paid 30% less in taxes than MNCs with no such links.
  • The second piece of research reveals that developing countries could have lost as much as €449 billion ($578 billion) of capital between 2007-10 when trading with or via Switzerland (the country that sits at the top of the Financial Secrecy Index 2011). 
Link:http://www.christianaid.org.uk/images/Who-pays-the-price-Hunger-the-hidden-cost-of-tax-injustice-May...

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