This is tax award season; the time of year when the tax journals give awards to their advertisers and subscribers for things like being transfer pricing firm of the year. I kid you not.
Christian Aid has got in on the act. It has created the Alternative Tax Awards:
Christian Aid today announces the winners of its new Alternative Tax Awards. Categories include Tax Haven Enthusiast of the Year, Low Tax Rate Achievement and Most Surprising Use of Tax Havens.
The Alternative Tax Awards take place today at a ceremony in central London, coinciding with accountants’ own Taxation Awards at the Hilton Hotel on Park Lane.
Christian Aid has created the Alternative Tax Awards to draw attention to the devastating effect corporate tax dodging has on poor countries. ‘We calculate that multinational corporations and other companies trading internationally dodge at least $160 billion in taxes in the developing world every year,’ says Christian Aid’s tax campaign manager, Judith Cavanagh.
‘This is one-and-a-half times the total annual amount of aid that poor countries receive and is desperately needed to fund public services such as hospitals and schools. We estimate that if the money was used according to current spending patterns, then the lives of some 350,000 children under five would be saved each year.
‘Much of the money that goes missing ends up in tax havens. The accounting rules must be reformed to prevent this happening. Tax dodging costs lives.’
Christian Aid will hold its Alternative Tax Awards ceremony outside the Hilton Hotel on Park Lane at 7.45pm this evening. The winners — detailed below - are invited to collect their trophies from us.
For the full award citations, please visit: www.christianaid.org.uk/images/alternativetaxawards.pdf
Greatest Potential for Tax Reform:
The joint winners are the Big Four accountancy firms - PriceWaterhouse Coopers, KPMG, Ernst & Young and Deloitte & Touche - together with the International Accounting Standards Board. These five organisations have between them the power to change the rules to help developing countries obtain the money that is rightfully theirs.
Most Surprising Use of Tax Havens:
The joint winners of this award are CDC Group plc and its sole owner, the UK Government’s Department for International Development (DFID). CDC has 72 subsidiaries, of which 40 are in tax havens including Bermuda, Mauritius and the Netherlands Antilles, the company told MPs in December 2008.
DFID argues that if CDC did not use tax havens, then investors in the funds used by CDC would be taxed twice. Christian Aid nonetheless finds it astonishing that the government department set up to tackle international poverty allows its own company to exploit tax havens as a means of avoiding tax in developing countries.
Low Tax Rate Achievement Award
P&O cruises’ owner Carnival deserves a special mention for its outstanding, dedicated and entirely legal use of tax avoidance. Between 2002 and 2008 inclusive, Carnival plc paid tax of just $61.7 million on total profits of $4.3bn. This is an effective tax paid tax rate, over the seven years, of approximately 1.4 per cent.
Tax Haven Enthusiast of the Year:
The winner of this award is Barclays plc. The financial services company is extremely keen on tax havens — with subsidiaries in some 315 of them. Again, this is entirely legal.
Most Overhyped Reform of the International Tax System:
Bilateral Tax Information Exchange Treaties (TIEAs) are the clear winner of this award. The Organisation for Economic Co-Operation and Development says TIEAs are an important weapon against tax dodging. They are voluntary instruments, however, which offer little or nothing to developing countries.
Good work Christian Aid. It was time someone pointed out that the awards the industry gives are for three things. The first is for redistributing wealth from the poor to the rich. The second is for undermining the rule of law. The third for destroying democracy, for tax is the essential element that ensures it might work by providing governments with the means to fulfil their mandate and tax advisers seek to reduce its availability. The rest is window dressing.
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The Christian Aid demo and stunt was a brilliant idea and well executed.
It’s such a shame though that your piece above goes OTT in its condemnation of the Taxation awards.
(Declaration of interest: I was a judge from about 1998-2002 and was a guest of the organisers last week. I’ve never been a winner).
The awards are voted on by a number of judges and, unless things have changed greatly from my day, they don’t even know who are advertisers and who aren’t. Indeed this is the first time I’ve ever heard it suggested that being an advertiser might be a factor in the decision process. I’m sure it isn’t.
The prompt for my comment here though was the allegation in your final para as to the rationale for the awards. I am speechless. As I’m sure you well know your 3 alleged criteria are not considered during the judging process. The criteria that are important are clearly set out in the entry particulars. Deciding factors are highlighted when shortlists are announced.
It is a gross distortion of the awards and insulting to the winners to suggest that they are involved and have been rewarded for the three activities on your list.
By the way, the top award, that of Tax personality of the year, was won this year by Chris Davidson, National Business Director of HMRC.
Mark
I admit I was referring to two sets of awards – the International Tax Review as well, the previous day
But Mark I really do think you should open your eyes a little wider – to suggest that the Taxation awards are not biased towards maintenance of the status quo and the firms and organisations that are a part of it and provide revenue to Lexis Nexis is, I suggest, pushing credibility a little
Mark, you have to be realistic: you were there as part of the hierarchy that keeps the tax structure in place. That’s not a criticism, it is a fact. The ICAEW, which you served well, serves the interests of a particular part of society and the award ceremony is designed, whether consciously or unconsciously to make clear that society thinks that the actions of those who receive awards are acceptable in the eyes of society at large.
But I reiterate my opinion: they are little better in most cases than the MP’s expense claims that have caused so much scandal.
Amd I’m not surprised Chris Davidson was awarded. I like Chris, but his work for the OECD delivered exactly what the profession wanted after Seoul: the message that only bankers were a problem. I strongly disagree with Chris on that, it is so obviously untrue. But of course they like him for it.
That’s not cynical or OTT: that’s simple accurate observation.
And I did not for a minute suggest corruption: again, simple observation was surely sufficient to see that these wards are self serving?
Sorry to disagree, but disagree I must
Richard