Written by Maaike de Hon
‘We are aware that Africa is losing more money from tax avoidance by foreign companies every year than its is getting from aid of the countries from which these people come,’ Zambian vice president Guy Scott captures the essence of the problem with this quote in the documentary Stealing Africa (2012).
Although nobody knows exactly how much money the developing world is missing out on as a result of rich countries offering multinationals the opportunity to avoid paying tax, the Washington based non profit organisation Global Financial Integrity (GFI) speaks of an estimated 1 trillion a year. To put things in perspective: the total amount of developing aid hardly ever reaches a level of 135 billion a year.
Reason enough for the Bee Network to put fair taxation on the Wicked Problem-list for the 20th of November. ‘We are problem owner of ‘global poverty,’ explains Judith Veenkamp, coordinator of the Bee Network steering group, ‘a field so overwhelming and big that we decided to concentrate on an aspect close to ourselves and the Dutch citizens that at the same time has an enormous impact: the Dutch taxation system.’
The Netherlands are famous for their friendly tax climate for large international companies, as the European Union recently confirmed in the Starbucks case . ‘I think more and more people are convinced that the unfair tax system is one of the root causes of global poverty,’ Veenkamp says. ‘Taxation is a very important instrument for a country to develop: the money collected is needed for infrastructure, hospitals, education and so on. Offering multinationals the opportunity to avoid paying tax is harming the development of poor countries.’
Due to the many layers and constructions that are involved, creating a fair international tax system is a complex problem, even when one focuses only on the Netherlands. The so-called rulings in which the Dutch tax authority records the deals with big companies are for instance probably in majority legal, but nevertheless harmful. To complicate things further the financial services are an important economic factor for the Netherlands. Changing the system therefore demands offers.
The Bee Collective Wicked Problem Session on fair taxation therefore promises to be an exciting event, Veenkamp accentuates, ‘I think it will be interesting to be in a sort of pressure cooker with stakeholders from all the different backgrounds involved, trying to find at least a starting point of a solution for the problem.’