Not my title: one Carlo Cottarelli, Director of the IMF's Fiscal Affairs Department, used for a blog on the Huffington Post.
He was talking about what the IMF is doing to help developing countries on this issue.
He lists a strong commitment by many countries to strengthen their revenue systems, through both administrative reforms and improved tax policies. And he refers to good governance and avoiding exemptions and preferences plus the need for political will to drive through tough policy changes to build and support firm, even-handed enforcement. These, he says, are the issues of concern for developing countries.
But he makes no mention at all of:
- transfer pricing abuse
- tax havens
- country-by-country reporting to ensure developing countries can get the information they need on multinational corporations' activities
- tax avoidance by multinationals in developing countries
- political corruption.
Is he on another planet form all in the development community?
Almost everyone I know thinks the matters I list are the real issues for developing countries face when it comes to tax.
But as ever the Washington Consensus ignores them.
Now, why is that? Ignorance, or a wilful blind eye?
You decide.
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The IMF’s ‘tough policy choices’ really mean reducing the role and cost of the state (assuming that it has a functioning role in many developing countries), creating greater inequality and further impoverishing the poor. Their policies are almost totally discredited within the development community, especially in Africa. China’s spectacular economic growth has had little to do with ‘good governance’. Unfortunately one of the few people still in awe to the IMF is George Osborne who is determined to take the UK further down the disastrous path of Washington Consensus economic policies.
[…] post was originally published on the Tax Research UK blog . Tags: Development, Economic Development, IMF, Tax, Transfer […]
“Now, why is that? Ignorance, or a wilful blind eye?
You decide.”
Already decided Richard. The reason why these secrecy tax havens are allowed to exist is to satisfy a very small minority of extremely rich, influential and greedy companies/individuals who have a powerful parliamentary lobby.
Without for example the Isle of Man, Jersey and Guernsey this lobby would not be able to instruct their lawyers and accountants to set-up “systems” to avoid paying tax in the UK.
It’s a simple problem with a simple solution – excepting that this greed is very well entrenched and able to influence others to turn a “blind eye.”