Message from OXFAM for GUE/NGL on Panama Inquiry

Susana Ruiz Rodríguez, Tax Justice representative for Oxfam International, commented on the issues at stake in the European Parliament’s Panama Papers Inquiry Committee

Tax scandals have proven tax dodging has become a systemic issue. Big companies are still widely exploiting loopholes to avoid paying their fair share of tax while ordinary citizens will in turn bear most of the effort. It is a global phenomenon hitting both rich countries such as EU member states and harming developing countries in desperate need for resources to pay for health, education and sustainable development. Tax avoidance increases inequality and prevents the eradication of poverty.

The offshore economy is now four times bigger than in 2001 and has been growing twice as fast as the global economy. Panama Papers should be knocking strongly on political responsibilities. There is no time for half-heartened unilateral actions. Oxfam hopes the new PANA Committee as set up by the European Parliament will expose the still widespread use of tax havens, with sound recommendations that can drive a transformative legislative agenda.

The European Parliament has been championing the debate on tax transparency. That is the leadership we need now to go to end tax havens. According to its own mandate on tax good governance, the PANA Committee should input the on-going listing process of tax havens and propose counter measures against those problematic jurisdictions.

Unfortunately, tax havens have a toxic spillover effect on other countries tax decisions. It is not only a matter of transparency and secrecy. Therefore, the PANA Committee has a unique opportunity to acknowledge the growing race to the bottom in corporate income taxation globally. It should also go even further in reconsidering the tax contribution of multinationals compare with the tax contribution of average tax payers such as SMEs or families.

There should be no taxation without representation. Let’s make it happen also for developing countries. The global scale of the problem makes the need for a new set of global tax reforms even clearer. The PANA committee should ultimately make a final recommendation for a more inclusive and democratic process, under the auspices of the United Nations.