Activities of Judith SARGENTINI related to 2015/2058(INI)
Plenary speeches (1)
UN International conference on financing for development (13-16 July 2015) - Tax avoidance and tax evasion as challenges in developing countries (debate) NL
Shadow reports (1)
REPORT on tax avoidance and tax evasion as challenges for governance, social protection and development in developing countries PDF (194 KB) DOC (126 KB)
Amendments (30)
Amendment 4 #
Motion for a resolution
Recital -A (new)
Recital -A (new)
-A. whereas the globalised economy poses serious challenges to increasing fiscal revenues; whereas fiscal space has been affected by tax competition among countries and by tax avoidance by international firms and wealthy households;
Amendment 9 #
Motion for a resolution
Recital B a (new)
Recital B a (new)
Ba. whereas according to the Global Financial Integrity Report of 2014, FDI and ODA combined from 2003 to 2012 represent slightly less than illicit outflows;
Amendment 12 #
Motion for a resolution
Recital B b (new)
Recital B b (new)
Bb. whereas illicit financial flows from developing countries are facilitated and perpetuated primarily by opacity in the global financial system;
Amendment 15 #
Motion for a resolution
Recital B c (new)
Recital B c (new)
Bc. whereas according to the UNCTAD, some 30% of cross-border corporate investment stocks have been routed through conduit countries before reaching their destination as productive assets;
Amendment 18 #
Motion for a resolution
Recital B d (new)
Recital B d (new)
Bd. whereas the main vehicle for corporate tax avoidance or evasion and capital flight from developing countries is the misuse of transfer pricing;
Amendment 19 #
Motion for a resolution
Recital B e (new)
Recital B e (new)
Be. whereas revenues from import tariffs, which used to account for a large proportion of public revenues in developing countries, especially in LDCs, will continue to erode with ongoing trade liberalisation agreements;
Amendment 20 #
Motion for a resolution
Recital B f (new)
Recital B f (new)
Bf. whereas according to the IMF, developing countries are particularly affected by corporate tax avoidance, as they rely more on corporate income tax for raising revenues than OECD countries; whereas practices which facilitate tax dodging by transnational corporations and individuals are widely used by European countries;
Amendment 21 #
Motion for a resolution
Recital B g (new)
Recital B g (new)
Bg. whereas tax havens, secrecy jurisdictions and illicit financial flows erode the tax base, undermine the fairness of the tax system and distort trade and investment;
Amendment 38 #
Motion for a resolution
Recital F
Recital F
F. whereas developing countries face major political and administrative constraints in raising tax revenues as a result of insufficient human and financial resources to collect taxes, weak administrative capacity to deal with the complexity of imposing taxes on transnational companies, lack of tax collection infrastructure, a drain of skilled personnel away from tax administrations, corruption, lack of legitimacy of the political system, an uneven distribution of revenues and poor tax governance; and whereas the lack of technical capacity in developing countries to handle complex matters in taxation is a constraint on both domestic revenue mobilisation and participation in international tax cooperation;
Amendment 48 #
Motion for a resolution
Recital G a (new)
Recital G a (new)
Ga. whereas the generation of public revenues from the extractive industries is essential to the development strategies of many developing countries; but whereas tax incentives granted by developing countries to attract FDI in these sectors deprive them of critical financial resources; whereas taxation policies related to the extractive industries shall accordingly be revised in order to protect the socio-economic interests of the host countries;
Amendment 51 #
Motion for a resolution
Recital H
Recital H
H. Whereas the fiscal space of developing countries is de facto constrained by requirements of global investors and financial markets; whereas developing countries have been offering various tax incentives and exemptions to attract or retain investors, leading to harmful tax competition and a ‘'race to the bottom’' that brings greater benefit to multinational corporations (MNCs) than to developing countries; and whereas as a result, taxes on corporate profits have been declining around the world;
Amendment 66 #
Motion for a resolution
Recital I
Recital I
I. whereas global tax competition has resulted in a shift of the tax burden to workers and low-income household, has impinged upon the possibility of developing countries to enhance domestic resource mobilisation and has forced damaging cutbacks in public services in poor countries; whereas many developing countries cannot attain even the minimum tax level necessary to finance their basic functioning, their public services and their efforts to reduce poverty;
Amendment 73 #
Motion for a resolution
Recital J a (new)
Recital J a (new)
Ja. whereas the setting-up of an intergovernmental body for tax cooperation under the auspices of the UN would enable developing countries to participate equally in the global reform of existing international tax rules;
Amendment 78 #
Motion for a resolution
Paragraph -1 (new)
Paragraph -1 (new)
-1. Notes with concern that tax resources remain low as a proportion of GDP in most developing countries, which are confronted with social, political and administrative difficulties in establishing a sound public finance system, thereby making them particularly vulnerable to the tax evasion and avoidance activities of individual taxpayers and corporations;
Amendment 79 #
Motion for a resolution
Paragraph -1 (new)
Paragraph -1 (new)
-1. Stresses that tax avoidance practices by MNEs are particularly unfair to developing countries as they suffer from greater reliance on tax revenues from corporate investors; furthermore, underlines that tax exemptions and advantages granted to foreign investors through bilateral tax treaties provide MNEs with an unfair competitive advantage compared to domestic firms, thereby jeopardising the survival and development of the small and medium- sized enterprises that are vital for their development;
Amendment 85 #
Motion for a resolution
Paragraph 2
Paragraph 2
2. IReminds that globalisation has affected the ability of countries to generate domestic government revenues and to choose their taxation structure, while lowering trade tariffs has already substantially reduced revenues from border taxes; notes that increased mobility of capital, combined with intensive use of tax havens , has greatly altered the conditions for taxing income and wealth, thereby affecting the fairness of the tax system; against this background, insists that effective mobilisation of domestic resources and a strengthening of tax systems will be an indispensable factor in achieving the post-2015 framework that will replace the Millennium Development Goals (MDGs), which represents a viable strategy to overcome foreign aid dependency in the long term;
Amendment 96 #
Motion for a resolution
Paragraph 4
Paragraph 4
4. Urges the Commission to support developing countries and regional tax administration frameworks in the fight against tax dodging, in developing fairer tax policies, in promoting administrative reforms and in order to increase the share, in terms of aid and development, of financial and technical assistance to the national tax administrations of developing countries; likewise, deems that support shall be provided for the economic reconversion of developing countries that are tax havens; urges equally the Commission to upgrade its assistance to strengthen the judiciary and anti- corruption agencies in developing countries,
Amendment 104 #
Motion for a resolution
Paragraph 5 a (new)
Paragraph 5 a (new)
5a. Calls on the EU to upgrade its financial and technical assistance in developing countries to address transfer pricing manipulation, and to scale up its cooperation on tax matters by encouraging the African Tax Administration Forum (ATAF) to enhance tax mobilisation and democratic governance in Africa; more broadly, urges the EU to encourage regional tax organisations to develop regional programmes to combat the adverse effects of international tax competition;
Amendment 110 #
Motion for a resolution
Paragraph 6
Paragraph 6
6. Urges that information on beneficial ownership of companies, trusts and other institutions be made publicly available in open-data formats, in order to prevent anonymous shell companies and similar legal structures from being used to finance illegal activities; in addition, believes that all countries should at minimum adopt and fully implement the Financial Action Task Force's (FAFT) anti-money laundering recommendations;
Amendment 111 #
Motion for a resolution
Paragraph 6 a (new)
Paragraph 6 a (new)
6a. Stresses that the potential offered by extractive industries to boost fiscal revenues is by and large not well exploited in developing countries due to the inadequacy of tax rules or to difficulties in enforcing them, since transnational companies frequently resort to tax avoidance techniques; recalls that this challenge is all the more acute for low- income countries that are heavily dependent on natural resources for their initial development drive; accordingly, deems that the fiscal conditions and regulations under which extractive industries operate shall be revised;
Amendment 112 #
Motion for a resolution
Paragraph 6 b (new)
Paragraph 6 b (new)
6b. Calls on the EU to increase its assistance in developing countries with the aim of strengthening the bargaining position of host governments to obtain better returns from their natural resources base and stimulate diversification of their economy; in addition, takes the view that the Extractive Industries Transparency Initiative (EITI) should be made mandatory and extended: it should not focus only on governments but also on producing firms and commodity trading companies;
Amendment 116 #
Motion for a resolution
Paragraph 7
Paragraph 7
7. Calls on the EU and the Member States to enforce the principle that listed or unlisted multinational companies must adopt country-by-country reporting (CBCR) as standard, requiring them to publish as part of their annual report on a country-by-country basis for each sector and territory in which they operate the names of all subsidiaries, their financial performance, relevant tax information, assets and number of employees, and to ensure that this information is publicly available; hence, calls on the Commission to put forward a legislative proposal to amend the accounting directive accordingly;
Amendment 128 #
Motion for a resolution
Paragraph 8 a (new)
Paragraph 8 a (new)
8a. Notes with concern that many developing countries find themselves in a very weak bargaining position in the face of some foreign direct investors "shopping around" for tax subsidies and exemptions; deems that companies shall be required to make precise commitments in terms of positive spillover effect of their investments on the local and/or national socio-economic development of the host country;
Amendment 129 #
Motion for a resolution
Paragraph 8 b (new)
Paragraph 8 b (new)
8b. Urges the EU to ensure a fair distribution of taxing rights while negotiating tax and investment treaties with developing countries; likewise, stresses that international corporate tax rules should include the principle that taxes should be paid where value is extracted or created;
Amendment 130 #
Motion for a resolution
Paragraph 8 c (new)
Paragraph 8 c (new)
8c. Underlines, in a context where export revenues fluctuate according to commodity price, that developing countries should keep policy space to impose capital controls to deflect speculation and ensure financial stability; likewise, urges the EU to refrain from imposing on developing countries a ban the use of export taxes on commodities in the negotiation of investment and trade agreements, so as to enable them to expand their fiscal revenues;
Amendment 135 #
Motion for a resolution
Paragraph 9 a (new)
Paragraph 9 a (new)
9a. Notes with concern that European countries (especially Spain, UK and Sweden) have negotiated bilateral tax treaties with developing countries with the aim of lowering or removing certain types of taxes, thereby creating routes through which transnational corporations can avoid taxation; underlines equally that most EU countries have failed to expose the true - or beneficial - owners of companies; in addition, points out that although EU governments have introduced country-by-country reporting for banks, many countries are still reluctant to do this for transnational companies in other sectors; urges the EU to show strong political will and determination against tax avoidance and evasion, in line with the principle of Policy Coherence for Development, as enshrined in article 208 of the Lisbon Treaty;
Amendment 137 #
Motion for a resolution
Paragraph 9 b (new)
Paragraph 9 b (new)
9b. Stresses, in a context where the EU intends to make a growing use of blending, that the private sector must respond to the highest standards of responsible financing; urges the EU to take the lead in the fight against tax evasion and tax avoidance by clamping down tax havens in Europe;
Amendment 144 #
Motion for a resolution
Paragraph 11 a (new)
Paragraph 11 a (new)
11a. Stresses that the creation of a legally binding UN inter-governmental body on tax cooperation shall include sanctions both for non-cooperative jurisdictions and for financial institutions that operate with tax havens; urges equally the EU to create a public European blacklist of non- cooperative jurisdictions as well as a European sanction mechanism in the event of non-compliance with EU tax good governance standards; takes the view that such sanctions may include being banned from accessing to public procurement, the possibility of withdrawing banking licences from financial institutions that operate with tax havens, etc.;
Amendment 150 #
Motion for a resolution
Paragraph 12 a (new)
Paragraph 12 a (new)
12a. Notes with concern that Development Finance Institutions (DFIs) are still supporting a large amount of investments routed through tax havens, by relying heavily on financial intermediaries;
Amendment 151 #
Motion for a resolution
Paragraph 12 b (new)
Paragraph 12 b (new)
12b. Stresses the role of Development Finance Institutions (DFIs) to set an example of best practise in establishing the highest standards of responsible finance; in particular, deems that DFIs should only invest in companies and funds that are willing to publicly disclose beneficial ownerships and report back their financial accounts on a country-by- country basis;