International

The plans published by the Organisation for Economic Cooperation and Development (OECD) to combat tax avoidance will continue to allow corporations to get away with paying low rates of taxation, says SP Member of Parliament and financial affairs spokesman Arnold Merkies, who also notes that the plans include no solution for the poorest countries, which suffer most as a result of tax avoidance by multinationals.

‘The multinationals, who as things stand profiteer from devices to avoid taxes, will have the chance to extend this until 2021. In that time they can therefore continue draining money from poor countries. These countries always as it is lose more money to richer countries through this than they receive from them in aid. This is a total denial of the gravity of the situation.’ In Merkies’ view poor countries have had very little influence on these plans. ‘Poor countries were only invited to the negotiating table in the final stages, and so could hardly take part in decisions over the package now before us.’

The plans also fall short on a number of other points, as Merkies explains. ‘There’s still no openness about how much tax multinationals pay per country, and no agreements on so-called transfer pricing, which are extremely important if we are to prevent multinationals from easily moving taxable profits to a country where they will barely be taxed.’