Tuesday, November 10, 2009

ActionAid: The G20 broke my heart

We are grateful to Martin Hearson of ActionAid, for the following blog summarising the whole G20 process to date:

"On Saturday I found myself on a ludicrously long train journey from London to St Andrews in Scotland, clutching my top-security accreditation for the G20 Finance Ministers summit, the culmination of the Outlandish Revenue Service's feverish project activity.

But I'm afraid to say it was a bit of a let down.

You know the story. Boy meets G20. G20 really like his proposals for greater transparency in international taxation. Boy gets his hopes up, follows G20 all the way to a remote Scottish golfing resort...

It all began in March, when the PM promised that, "at the London Summit we will set out new measures to crack down on the tax havens that siphon off money from developing countries - money that could otherwise be spent on bednets, vaccinations, economic development and jobs."

And they did, promising "proposals, by end 2009, to make it easier for developing countries to secure the benefits of a new cooperative tax environment."

It was not a question of "leesten very carefully, I shall say zis only once," either. Gordon Brown was at it again in July, getting his mate French president Nicolas Sarkozy in on the act, with the two promising that:

"We will work together through the G20 to ensure that proposals are developed by the time of the next G20 Summit to ensure that developing countries can benefit from the new cooperative tax environment, including through a new multilateral tax information exchange agreement."

In that same month, the G8 lent its support, and the government's new policy paper on international development had tax written all over it. Literally!

Was I getting the wrong impression? The signals looked clear to me.

Keen to seal the deal, my Outlandish Revenue Service colleagues and I bombarded the Treasury with 3000 letters, and spent hours making them a compilation tape.

Stephen Timms, the Minster with responsibility for tax, was the man for me. Yes, there was the matter of that video of him with one of my colleagues. But I forgave him all that when he wooed me with his talk of a "robust review mechanism to evaluate the benefits of information sharing to developing countries" and the "possibility of a shift to automatic tax information exchanges". Here was a guy that understood what I wanted. A guy that really got me.

With all these promises in the run up to Saturday's G20 summit, I travelled up in the hope that there would be an end to all this teasing. Were the G20 ready to commit?

Alas, the answer was no. Instead of the concrete promises I had been hoping for, all they would say was that they was that they welcomed "the possible use of a multilateral instrument."

Alas, not even the tasty Arbroath smokies could make make up for this crushing disappointment. Without the political pressure that results from unequivocal G20 support, it will be much harder for the OECD (the boffins behind any multilateral instrument) to build an ambitious proposal and persuade everyone (including tax havens and rich countries) to join it.

Sure, I'm prepared to give the G20 a second chance next year. It's still possible for them to do more to help developing countries benefit from the crackdown on tax havens.

In the meantime, there are other fish in the sea. I hear the European Parliament has a bit of a thing for country-by-country reporting, for oneā€¦"


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