Tax Evasion: Tough times for multinationals as G8 meets in Northern Ireland

G8 Obama talk17 June 2013, Lagos – Strict sanctions and tough times awaits multi-national companies operating in developing countries such as Nigeria, as members of the Group of Eight, G8, industrial nations meet today in Lough Erne, Northern Ireland, United Kingdom to deliberate on the matter and other crucial issues.

UK Prime Minister, David Cameron, at the weekend, ahead of the G8 summit met with officials of British overseas territories where he assured countries affected with shady tax evasion that the government was prepared to clampdown on the biggest tax havens in the world.

One out of five tax havens in the world are British overseas territories, and are sometimes regarded as ‘shady places for shady men’.

In the meeting, which included officials from Cayman Islands, Jersey, Bermuda, British Virgin Islands, Cook Islands, Isle of Man, among others, Cameron said the time had come to put an end to ‘secretive companies in secretive locations’.

He explained that, “we need to know more about who owns which company-beneficial ownership-because that is how a lot of people and a lot companies avoid tax-using secretive companies in secretive locations.”

“The way to sweep away the secrecy and get to the bottom of tax avoidance and evasion and cracking down on corruption is to have a
register of beneficial ownerships so that tax authorities can see who owns beneficially every company.” Cameron said.

In March, Oxford University Director for the Centre for the Study of African Economies, CSAE, Prof. Paul Collier, is of the view that the G8 under the leadership of UK had decided to help countries like Nigeria to block companies operating in developing countries from tax evasion.

Action Aid in 2012 estimated that Nigeria and other countries in Africa lost close to $49 billion through tax evasion in the continent.

Also, Tax Justice Network, TJN, a watchdog against tax evasion by wealthy people and multinational companies said money laundering, tax avoidance and evasion cost mostly the developing world approximately
$28 to 32 trillion. Much of such illicit funds find solace in tax havens in British overseas territories, Switzerland, South East Asia
and France.

The new push by the G8 for a more open tax system which will compel multinationals operating in developing countries requires tax havens to sign agreement on transparency that will bring about more disclosure on illicit wealth traced to elites and big companies who
used such locations as cover up.

The new policy is expected to beam its searchlight on Nigeria, where foreign companies are said to be engaged in naked display of tax avoidance through corrupt practices.

A source who would not want his name in print, said that with the new commitment in place, the UK government will begin to scrutinise most British companies in Nigeria.

Major oil companies operating in Nigeria are said to be on the watch list of US and UK governments over tax evasion. Foreign airlines, telecom companies and other companies in the extractive industry in the country have also been accused of short changing Nigeria on taxes.

Meanwhile, G8 members were also billed to find the way forward on Syrian, amid accusations that President Bashar al-Assad regime had used chemical weapons on his people. US, UK, France were said to be in
support of arming the Syrian rebels, a position, Russia vehemently opposed.

Cameron and Russian President, Vladimir Putin, had held a pre-conference meeting in London, before heading for Northern Ireland
resort where the G8 Summit takes place. US government pledged last Friday to assist Syrian rebels with limited assistance, Cameron also made similar pledge at the weekend.

Reports said American troops are already in the Syrian border with Turkey to offer necessary assistance to the rebels, a move, observers said will help contain Assad forces in the ongoing Syrian civil war.

– ThisDay Newspaper

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