Wednesday 13 December 2017

G8 Leaders: Countries should not allow companies shift profits across borders

World leaders around the table at the G8 Summit
World leaders around the table at the G8 Summit

Fiach Kelly in Enniskillen

THE G8 leaders have agreed the "Lough Erne Declaration" - which says countries should change their rules that allow companies shift profits across borders - at the conclusion of their summit in Co Fermanagh.

The end of summit statement could shift the focus to countries like Ireland which haver been criticised recently for their tax regimes, and how multinational companies use their tax systems.

The 10 point agreement also says "tax authorities across the world should automatically share information to fight the scourge of tax evasion" - but not avoidance.

However, it does say national rules should be changed so companies cannot "shift their profits across borders to avoid taxes, and multinationals should report to tax authorities what tax they pay where".

The agreement comes at the end of the G8 summit, which highlighted the fight against tax avoidance and evasion as one of its main themes.

The Lough Erne declaration also says: "Companies should know who really owns them and tax collectors and law enforcers should be able to obtain this information easily.

"Developing countries should have the information and capacity to collect the taxes owed them – and other countries have a duty to help them."

The preamble to the declaration also says that while "private enterprise drives growth, reduces poverty and creates jobs" Governments have "a special responsibility to make proper rules and promote good governance".

"Fair taxes, increased transparency and open trade are vital drivers of this," it adds.

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