Tuesday, April 23, 2019

Morals, taxes do not mix well: Jesuit economist

Canada Africa Jesuits accountability transparency business corporations Catholic corruption fascism politics tax evasion mining

Accounting isn’t nearly as dull as we think it is, at least for those who practice the craft on behalf of international corporations that don’t want to pay taxes.

Corporate tax accountants can employ such schemes as the “single malt,” the “green jersey,” “patent boxes” and the “double Irish” to sidestep the tax man.

“I studied accounting once,” said Rotman School of Business, University of Toronto emeritus professor of economic analysis and policy Richard Bird. “My first accounting professor — this was in England — said to me, ‘What do you say when your boss says tell me what the profits are for last year?’ I didn’t know. I was a first￾year student. He said, ‘You ask him what he wants them to be.’ ”

All that accounting creativity is costing Africa big time, complains Jesuit Fr. Charlie Chilufya, an economist and director of the Justice and Ecology Network for the Jesuit Conference of Africa and Madagascar.

A 2016 report from a panel headed by former South African president Thabo Mbeki estimated the offshoring of profits for tax purposes was costing African countries between $60 and $100 billion per year in tax revenue. To make the math easier, Chilufya uses the figure of $50 billion for the 54 countries in Africa, asking his audiences what it would mean to put nearly $1 billion per year into the treasury of every African nation.

That kind of injection would mean there would be medicine on the shelves of pharmacies in rural hospitals, food for poor mothers and their children and paved roads to allow farmers to get their crops to market.

Canada is deeply involved in all of this, Chilufya told his audience at a presentation titled “Africa: Tax Justice and the Common Good” at the Mary Ward Centre in Toronto, organized by the Canadian Jesuits International, last month. Canadians for Tax Fairness pegged Canadian funds squirreled away in tax havens at $261 billion at the end of 2016, down from $272 billion in 2015.

Chilufya pointed out that Canadian stock markets are home to about half the publicly-traded mining companies in the world, and that international mining companies are among the masters of tax avoidance, often negotiating extended tax holidays with corrupt or illegitimate governments in exchange for investments that are sometimes grossly overstated.

“This is a matter of ethics,” Chilufya declared, speaking a few blocks north of the world’s largest stock market for mining, oil and gas.  (more...)


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