C20: new civil society policy paper on tax justice

Adapted from the Global Alliance for Tax Justice. 

Organisations from 91 countries from around the world, representing close to 500 civil society organisations and almost 5,000 individuals, have been working together for the last 18 months via the Civil 20 (C20) to engage with G20 governments on some of the critical issues facing today’s world.

The C20 Summit took place recently in Turkey, and it released a Policy Paper on International Tax emphasising that tax is key to financing sustainable development, and reform of international corporate taxation is essential to restoring its legitimacy, as well as to ending the use of the tax haven and offshore secrecy system for facilitating capital flight and concealing the proceeds of crime and corruption.

The C20 recommendations are:

On corporate and financial transparency, the G20 should

• consider how to extend the Beneficial Ownership registry system to all jurisdictions worldwide;

• ensure that all Beneficial Ownership registries are public;

• make a clear commitment to a multilateral mechanism for automatic exchange of information with all willing countries, and with a transitional mechanism to allow developing countries to benefit from receiving information while adapting to the requirements to send information;

• require all participants to collect and publish annually statistical data on the aggregate sums passing through their financial system, broken down by country of residence of the account holder and of controlling persons.

On reform of international corporate taxation:

• Country-by-Country reports should be filed directly with all tax authorities where the MNE has a taxable presence, and in our view these reports should be published;

• interest deductions should be limited so that they are no greater in aggregate than the consolidated interest costs of the corporate group as a whole;

• G20 Leaders should adopt a High Level Declaration which would commit states to end all harmful tax practices and ensure transparency especially of tax incentives and tax rulings;

• procedures for settling international tax disputes should comply with due process standards, including truly independent adjudicators and reasoned decisions which are published, and countries should not be pressured into accepting adjudication if they consider it unsuitable for them;

• all G20 countries should commit to rapid insertion of development-friendly provisions in their treaties with developing countries, and of strong purposive and anti-abuse provisions in all their tax treaties, preferably by including such provisions as core and compulsory elements in the proposed multilateral convention;

You can read the full document here.

The Global Alliance for Tax Justice emerged from TJN but is now organisationally separate from us.