Christian Aid seeks end to tax dodging

Christian Aid is campaigning for reforms to the accountancy sector to stamp out tax dodging by businesses trading internationally.

The aid agency estimates that tax dodging costs developing countries at least $US160bn a year in lost revenue.

It warns that a "change of culture" is needed in the world of accountancy if reforms are going to be carried through.

The aid agency is pressing the International Accountancy Standards Board to introduce a new accountancy rule that would compel multinational corporations to reveal how much profit they make and how much tax they pay in each country of operation.

Some 80,000 Christian Aid supporters are being called upon to send postcards to the UK heads of the ‘Big Four’ - KPMG, Deloitte, Ernst & Young, and Price Waterhouse Coopers LLP.

"You have a key role to play in ensuring that billions of the world’s poorest people benefit from the same essential services as you and your family," the postcards state.

It goes on to encourage the companies to use their influence to help decide how multinationals account for their profits, and to support Christian Aid’s call for an international accounting standard.

Judith Cavanagh, Christian Aid’s economic justice campaign manager, said: “The new standard would help do away with the practice, currently widespread, of businesses artificially reducing the profits they claim to make in developing countries to reduce their tax liability. The practice, called trade mispricing, costs developing countries dearly.”

Christian Aid estimates that the US$160bn lost each year as a result of tax dodging could save the lives of 350,000 children under the age of five every year.

“We decided to approach the Big Four because of their power and influence at the International Accounting Standards Board,” said Ms Cavanagh. “Minimising tax whatever the social consequences has in recent years gained a spurious respectability which they could help puncture.”

On the web:
Campaigners can also lobby the Big Four via email, from a page on the Christian Aid website: