News: Extract-A-Fact: To stop losing mining revenues, dig the details
October 2, 2017. Source: Kathleen Brophy, Oxfam America, and Eneya Maseko, Oxfam in Zambia
This post originally appeared on politicsofpoverty.oxfamamerica.org on September 29, 2017
How detecting and deterring “transfer mispricing” in Zambia’s billion dollar mining sector can boost government coffers in a time of fiscal crisis.
Corporate tax dodging is not a victimless act. When corporations employ
aggressive means to avoid paying tax in developing countries, citizens
inevitably foot the bill. Corporate tax avoidance deprives governments of
desperately needed tax income for the provision of public goods and
services forcing governments to choose between cutting public services or
collecting additional tax from citizens. So, while companies report eight
and nine figure profits, citizens face eroding hospitals and schools and
struggle to pay higher prices for basic goods. However, when companies do
this while in the process of extracting a high value, exhaustible commodity
from beneath citizens’ feet, the offense is all the more egregious.