Paying a ‘Fair Share’: new brief on taxing multinational companies

Posted on May 9 2017

In this new brief just published by the Sheffield Political Economics Research Institute authors John Mikler and Ainsley Elbra address the issue of global corporate tax avoidance and consider how multinational corporations can be made to pay their fair share of tax. They focus in particular on the strategies to avoid taxation deployed by Apple and Google and consider in depth the public enquiries undertaken in the United States, Australia and the United Kingdom into the methods of avoidance adopted.

The authors conclude that:

  • Governments must take the lead in developing effective taxation regulations, rather then relying on self-regulation or working with MNCs;
  • Global corporate tax avoidance is not caused by market forces, but by the nature of regulatory competition between states;
  • As the major headquarters for MNCs, including those most heavily implicated by their aggressive tax avoidance strategies, the United States must take the lead in regulating them to pay their fair share of tax at home and abroad.

Read the full brief here.

NB: Reposted from the Tax Justice Network blog with permission

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9 Responses

  1. Fluffy Russet says:
    May 9 2017 at 8:05 pm

    I peeled off the skin of that report and chopped it into pieces so to speak. What I discovered was a brilliant, nay tuberously earthy, explanation of the difference between what is a fair share of tax, and what is the legally owed amount of tax which is what the MNCs are paying anyway.
    Congratulations to the ‘authors’.

  2. Derek says:
    May 9 2017 at 10:24 pm

    Along with Governments quickly getting their act together and taking the lead in tax regulations, it could be a useful to use the following method to regulate a balance of trade as part of brexit for a number of reasons. The method (devised by Buffett) involves using Import Certificates given to all UK exporters in an amount equal to the pound value of their exports. Each exporter would, in turn, sell the ICs to parties-either exporters abroad or importers here – wanting to get goods into the UK.

    Note this market would in part encourage many using offshoring tax evasion to come onshore. We could see a slight rise in costs to the consumer, but I think its worth it to create better paying jobs throughout the uk as a whole and a more balanced economy that’s not ‘so’ precariously dependent on the city, encouraging on-shoring and help protect against inflation caused by pound devaluation. If we wanted to create a trade-deficit we could by donating ICs to third world countries for example.

    This idea about ICs is taken from Buffett here: https://www.google.co.uk/amp/amp.timeinc.net/fortune/2016/04/29/warren-buffett-foreign-trade/%3Fsource%3Ddam

    • Richard Murphy says:
      May 10 2017 at 7:05 am

      I think the result would be an offshore, unregulated and untaxed, market in ICs.

      • Derek says:
        May 10 2017 at 7:16 am

        ICs could be regulated and reqiredto be cleared onshore in the UK (i.e. Bought and sold here) – we have the infrastructure, skills and resources for that.

      • Richard Murphy says:
        May 10 2017 at 8:27 am

        Derek

        Respectfully, it’s a ludicrous idea

        Richard

      • Derek says:
        May 10 2017 at 8:37 am

        I’m not so sure it is at all. I would expect people to feel that way, it actually doesn’t seem to matter what the field is – paradigm shifts tend be rebuffed before they are eventually realised and proven to be an advancement. Its human nature – the world was flat, god created humans – the scientific fields the seemingly most rational of all endeavours are littered with examples. So i anticipated this response, although respectfullly perhaps hoped for a more enquiring, open-minded look at it.

        I suggest ICs are a real part of the puzzle that this country needs post-brexit.

  3. Claire says:
    May 9 2017 at 11:32 pm

    I’m going to leave this blog post from Craig Murray here since it echoes what I have been thinking for quite some time. There have been those of us on the left who have felt for some time that the direction of travel of the Tory party is boderline fascism. My view hasn’t changed. Will we soon have a 4th Reich? I fear we are sleep walking into one, but the blame for this is squarely down to the Troy ricght wing.

    https://www.craigmurray.org.uk/archives/2017/05/journalists-state-functionaries/