Tax Campaign

How tax can help end poverty:

People everywhere want education for their children, good healthcare and, at the very least, basic sanitation and clean water.

But it costs money - money that poor countries don't have. In wealthier countries these goals have been largely achieved thanks to the public services provided by tax revenue.

Christian Aid estimates that poor countries are being deprived of around US$160 billion each year through tax dodging by some unscrupulous multinational companies, far more money than they receive in aid. This money could potentially be spent on education, healthcare, water and sanitation if it were available to poor countries.

Watch this video from Guatemala to see the difference that tax revenue could make.

One common method of tax dodging is for a company to manipulate its profits and revenues through tax havens, which combine high levels of secrecy with very low or even zero tax rates. It is very hard to trace this activity due to the financial secrecy that tax havens offer to companies.

Christian Aid believes that the key to ending tax dodging is greater transparency. If companies were required to report on their profits made and taxes paid on a country-by-country basis, the resulting transparency would allow tax revenue authorities in poor countries to identify which companies may be dodging taxes. For example if a company that carried out most of it's business in Tanzania was making a loss in Tanzania and yet was declaring billions in profit in a tax haven it would be clear that something was amiss. At present companies only have to report on their global profits and taxes.

Incidentally, not only would this system highlight bad practice and tax dodging, it would also highlight those companies who are operating ethically and paying a fair share of tax, therefore ethical, tax compliant companies should have nothing to fear.

You can see the positive benefit that campaigning on tax has already had in Bolivia here:

The Methodist Church in Ireland endorsed Christian Aid's tax campaign at Annual Conference in 2011 when the following resolution was passed:

"This Conference:

• Recognises the importance of taxation in developing countries for ensuring development and building accountability between states and citizens.
• Requests that both the Irish Government and the British Government support the call for a new international accounting standard requiring companies to report on profits made and taxes paid in every country where they operate - so called country-by-country reporting."

Find out more about how you and your congregation can support Christian Aid's campaign here: www.christianaid.ie/tax