Financial Transparency Coalition

At this year’s summit, G8 leaders had an opportunity to pursue tax and transparency policies that would provide economic stability, root out systemic corruption and enhance the democratic process in rich and poor nations alike. Today G8 leaders largely failed to seize this opportunity.

David Cameron’s desire to see the creation of public registries disclosing the beneficial owner of companies is admirable. But world leaders agreed today only to ad-hoc, national-level promises to introduce registries, with no guarantee that even this limited information will be made public. There was no G8-wide commitment to introduce registries containing the beneficial owners of companies and trusts, and this is deeply disappointing.

It is, however, extremely encouraging that G8 leaders stated as one that automatic information exchange between tax authorities should be “the global standard” and that furthermore, G8 countries have “a duty” to help developing countries improve their capacity to enforce tax laws. President Obama’s G8 Action Plan on identifying company ownership released today is a good start in tackling the issue in the United States.

But we remain concerned that rich countries may want to play by a different set of tax information sharing rules than poorer nations. The impact of trillions of dollars that multi-national corporations and corrupt officials siphon out of poor countries is ten times the aid that flows into these countries.

The Financial Transparency Coalition is encouraged that G8 leaders have tasked the OECD with developing a template to extend Country-by-Country reporting standards in a move that further legitimises this important transparency tool.

Porter McConnell, manager of the Financial Transparency Coalition, said: ”People in rich and poor nations alike are looking to their leaders to resist vested interests and pursue policies that tackle corruption and rampant tax dodging. Today G8 leaders have taken some significant steps in an effort to make the rules of the global economy fair for everyone.

“But it is troubling that there is no G8-wide agreement on the introduction of beneficial owner registries, let alone that they be made public. Over the past several months, crimes that rely on financial secrecy, such as tax evasion, money laundering and trafficking, have become front-page news. Illicit finance is one of the most pressing issues of our time:  it’s robbing citizens of developing countries and G8 countries alike. We hope G8 leaders will build on what they have agreed today, and put in place some basic financial rules to staunch this massive flow of secret cash.

Contact:

United States: Dietlind Lerner: +1 202 577 3455 dlerner@financialtransparency.org
Europe: Nick Mathiason: +44 (0) 77 99 348 619 nmathiason@financialtransparency.org

Notes to Editors:

The Financial Transparency Coalition consists of over 150 organizations across the globe, including Christian Aid, Eurodad, Global Financial Integrity, Global Witness, Tax Justice Network and Transparency International. This coalition works together with a panel of governments and a group of experts to address opacity in the international financial system, which creates inequalities that harm billions of people.

The FTC was formerly known as the Task Force on Financial Integrity and Economic Development.