Local view for "http://purl.org/linkedpolitics/eu/plenary/2011-03-07-Speech-1-224-000"
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"en.20110307.25.1-224-000"2
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"Mr President, Commissioner, ladies and gentlemen, it is with some satisfaction that I present this report on tax and development to you tonight.
It represents an important stage in a battle that began a long time ago, which I am now pursuing in the European Parliament. I would like to thank my colleagues in the Committee on Development, with whom the work has been extremely productive. I hope that it will find confirmation during tomorrow’s votes.
Developing countries have been very badly hit by the financial and economic crisis and the rising prices of agricultural materials and now need substantial new sources of funding more than ever. Amid this context of global crisis, tax revenue, which is the oldest source of development funding, is a major issue and a genuine challenge.
Effective taxation systems not only provide funding for vital public services. By promoting the transparent, responsible use of government revenue, they are also one of the foundations of a responsible democracy. Contributing towards raising equitable, progressive and transparent taxes should in no way lead to removing or reducing official development assistance (ODA). It should not provide a further excuse for Member States that are increasingly inclined to reduce their share of GDP which is devoted to ODA.
Whilst ODA may be imperfect and have much room for improvement, it is no less vital for countries that have been severely affected by both economic and climate-related crises. It is not a question of replacing aid, therefore, but of redirecting it towards developing effective taxation systems, to which the multinationals must contribute on the basis of their actual profits. In this way, poor countries will be able to take ownership of their development once again, reduce poverty and compensate for the loss of customs revenue caused by the liberalisation of the markets, so that in the long term, they will be able to manage without foreign aid.
However, the countries of the South are not only victims of their own ineffective taxation systems. They are also victims of the tax dumping imposed by the Bretton Woods bodies, of the cost of illicit capital flight, and of tax havens. Every year, they sustain colossal losses of tax revenue estimated at over ten times the amount of aid they receive from rich countries.
This report emphasises this fact. As for the OECD guidelines, far from being adequate, they actually pose a threat. By allowing non-cooperative jurisdictions to be taken off the grey lists simply by signing cooperation agreements without imposing any automatic exchange of information, they are creating the illusion that tax havens are legitimate and conferring credibility on a system that is harmful to public finances in North and South alike.
Putting an end to tax havens is a vital step towards these countries’ development, and the European Union must make it an absolute priority. The EU must shoulder its responsibilities as the United States has done and produce clear, binding legislation coupled with genuine sanction mechanisms in order to put an end to tax havens, which are like weapons of mass destruction for the development of poor countries. The EU must prevent profit and transfer price manipulation by companies, especially European companies, which both benefit from and abuse detrimental taxation systems. It must impose the introduction of a transparent, binding international mechanism that will place a duty on all multinational companies, especially those in the extractive industries, to automatically declare the profits they make and the taxes they pay in each of the countries in which they operate.
This is a vital first step towards stopping those who are getting rich on the back of the Southern countries’ misery. It is also a vital step towards restoring the European Union’s credibility."@en1
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