Tax pirates: Action packed drama now showing in real life - Op Ed, Canberra Times

TAX PIRATES: ACTION PACKED DRAMA NOW SHOWING IN REAL LIFE

The Canberra Times, 4 May 2019

It is common for forms of serial fiction such as comic books, or film or television franchises, to have a new start of that universe – often called a ‘reboot’. The one I’m encouraging is Tax Pirates of the Caribbean. In this action-packed drama, a buccaneering team of tax specialists travel to Jamaica. 

Armed with their rapier wit and a brilliant knowledge of the tax code, they confront multinational firms, headquartered in nearby tax havens, who’ve been luring away the revenue that should be supporting Jamaica’s schools and hospitals.

The script should be easy to write, since the events are playing out right now. The Jamaican tax authority has ‘borrowed’ a bunch of expert tax auditors from Germany. The accountant equivalent of Captain Jack Sparrow is German auditor Steffan Scholze, who said he ‘jumped at the opportunity to … fight inequalities and give countries added confidence in their dealings with large taxpayers’. Within weeks, he was helping Jamaica take on multinationals who’d refused to pay their fair share of tax.

The program is known as Tax Inspectors Without Borders, and claims to return an eye-watering $100 of revenue to developing nations for every $1 of investment from donor countries.

To date, Tax Inspectors Without Borders has been largely funded from Europe and focused on Africa. But the problem of tax avoidance is just as acute in the Asia-Pacific.Tax authorities in the Philippines, Solomon Islands, Fiji and Laos lose the equivalent of 2 per cent of national income as a result ofcompanies shifting profits to low-tax locations.

A proposed $5 million a year in funding for Tax Inspectors Without Borders, on a 100:1 rate of return, would increase revenues by half a billion dollars for developing nations. Labor’s commitment will allow the program to administer an Asia-Pacific hub and dramatically increase its work in countries such as Papua New Guinea and Vietnam.

Australia’s aid program is in a shocking state. Development assistance under Labor grew every year when we were last in power, reaching around 0.35 per cent of Gross National Income. Since then, the Abbott-Turnbull-Morrison Governments have slashed the aid budget to 0.21 per cent of Gross National Income in 2019-20. That’s the lowest level on record. If the aid budget follows its current trajectory, development assistance is forecast to drop to a measly 0.18 percent of Gross National Income in 2022-23.

The Coalition’s cuts have impugned our reputation internationally, undermined our national interests, damaged our efforts to alleviate poverty, and made our region less secure. Labor will increase Official Development Assistance as a percentage of Gross National Income every year that we are in office, starting with our first Budget.

Strengthening tax systems and boosting aid also complements Labor’s practical commitment to ensure more dollars sent to developing nations through remittances make it to the hands of recipients.

Developing nations in the Asia-Pacific need more than just our support. We will also ensure that they get more remittance flows. And, through Tax Inspectors Without Borders, we will ensure they will collect more of the tax revenue that they are owed.

Things are shifting. As a result of the work of people like Steffan Scholze, Jamaican tax officials are finally getting the upper hand. As one commentator observed: ‘Recently a team came back from meeting one company so excited… for the first time ever when dealing with a large taxpayer, our people did the talking and the [multinational representatives on the] other side sat dumb, struggling to answer the questions’.

For Labor, our values don’t stop at the continental edge. Social justice, decent work conditions and human rights aren’t just things we fight for in Australia – they’re also values that inform our dealings with the world. 

The same goes for our belief that multinational firms should pay their fair share of tax. Tax fairness isn’t just a domestic policy issue. Under a Shorten Labor Government, we will work with other nations to improve the global rules, and use our aid program to help ensure that the world’s poorest nations are no longer being ripped off by the world’s richest companies.

Andrew Leigh is the Shadow Assistant Treasurer, and his website iswww.andrewleigh.com.

ENDS

Authorised by Noah Carroll ALP Canberra.


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Cnr Gungahlin Pl and Efkarpidis Street, Gungahlin ACT 2912 | 02 6247 4396 | Andrew.Leigh.MP@aph.gov.au | Authorised by A. Leigh MP, Australian Labor Party (ACT Branch), Canberra.