Ethics and governance in the European Financial centers

KPMG recently published a paper that examines the relationship between a company ’s approach to its tax liabilities and its attitude to corporate social responsibility (CSR).

As explained in the abstract, the paper adopts the view that CSR is a legitimate interest of business. It argues that, because CSR is a way of doing business rather than an ‘add on ’ to normal business processes, companies should consider how their chosen approach to CSR applies to all aspects of their activity,including the management of their tax liability. They should then be in a position to give a reasoned justification of their approach to key tax issues such as the use of tax minimisation techniques,which is consistent with their approach to other CSR issues. Possible challenges to this approach are also considered.
Quantum is the only significant variable when assessing a company ’s tax contribution; in contrast to many other aspects of its business activity, the relevant question as regards its tax liability is not how it pays it, but only how much it pays. Accordingly the paper goes on to consider how CSR principles might be applied to the principal means by which a company may reduce its tax payments: ie, broadly, tax avoidance and tax planning (which are defined for the purpose of the discussion). While tax evasion is another means by which companies sometimes reduce their payments, CSR factors are not considered to be relevant in this context because such behaviour is already ruled out on more fundamental ethical grounds.

The paper sometimes sounds strange.

Read paper

The Tax Justice Network issued the following notice :

Invitation to Participate in a Workshop on
TAX JUSTICE, TRANSPARENCY AND ACCOUNTABILITY

Essex University, 3 - 4 July 2008

The role of transparency and accountability in creating tax justice will be the main theme of the sixth annual research workshop in the current series jointly organised by the Association for Accountancy & Business Affairs and the Tax Justice Network.

Having explored the themes of tax and poverty and tax and finance for development in our last two workshops, we thought a different perspective appropriate in 2008. In focusing on accountability and transparency we wish to highlight the fact that the supply of honest information to taxing authorities is a prerequisite of a just tax system.

The themes that might be explored within this remit are wide, and might cover:

1. Problems of taxation of mobile capital;
2. International cooperation and transparency for tax purposes;
3. Accounting and tax transparency;
4. Secrecy, tax havens and offshore finance centres;
5. Relationship of tax to trade and investment agreements;
6. Are national governments losing the power to tax?;
7. The accountability of government for taxation revenues.

No doubt others will emerge as the workshop agenda develops.

The aim of this workshop is to bring together researchers, academics, journalists, policy staff of civil society organisations, consultants and professionals, elected politicians and/or their researchers, and government or international organisation officials to explore issues on these and related themes. The purpose of the workshop is to facilitate research through open-minded debate and discussion, and to generate ideas and proposals to inform and shape the political initiatives and campaigns already under way.

There will be a small charge for attendance at the Workshop. Participants are usually expected to finance their own travel although applications from students and others with limited means for bursary support will be considered. Accommodation at Essex University will be available at modest cost.

Anyone interested in participating should provide details of the nature of their interest, affiliations and any relevant research or publications to:

Richard Murphy FCA, Director, Tax Research LLP
The Old Orchard, Bexwell Road, Downham Market, Norfolk PE38 9LJ
United Kingdom +44 (0) 1366 383500 +44 (0) 777 552 1797
richard.murphy (at) taxresearch.org.uk

Offers of papers are especially welcome and early submission is encouraged as applicants have exceeded available spaces in recent years. Any submissions will be actively considered by the organising committee which comprises:

John Christensen (Tax Justice Network)
Jo Marie Griesgraber (New Rules for Global Finance)
Prem Sikka (Essex University)
Richard Murphy (Tax Research LLP)
Ronen Palan (Birmingham University and IDS, Sussex)
Sol Picciotto (Lancaster University)

As the Finantial Times wrote today, foreign banks may face a "public perception that they have something to hide" if they do not co-operate with a new offensive to prise open secret offshore accounts of wealthy Britons, Revenue & Customs has warned.

Know more

Read article from The Herald