ActionAid supporters around the world are demanding that their governments don’t give big companies tax breaks and crack down on tax avoidance.
These are some highlights from our recent tax justice campaigns.
Calling time on SAB Miller - October 2010
SABMiller is one of the world’s biggest brewers. In 2010 we published a report that revealed how SABMiller’s operations in six African and South Asian countries – including Ghana, Zambia, Tanzania, Mozambique, South Africa and India - were shifting millions of dollars of profits out of those countries into low-tax havens, which we estimated avoided enough tax to put 250,000 children to school in those countries. ActionAid supporters demanded that SABMiller paytheir taxes in those countries by:
- writing directly to the company
- voting to ban the company’s beers from their student union
- asking awkward questions at their annual general meetings
- raising awareness by giving out our “Schtop tax dodging” beer mats, which found their way to Sweden, the Netherlands, Ghana, Zambia, South Africa, Senegal and the United States.
In Australia, ActionAid supporters organised pub crawls in Sydney, Melbourne, Adelaide, Perth and Brisbane - handing out thousands of mock Peroni beer mats to patrons and asking them to sign ActionAid’s letter to the CEO of Pacific Beverages in Australia (local distributor of SAB Miller brands).
In June 2011, tax authorities from several African countries used our report to inform their discussions on transfer pricing. Following that meeting, efforts from the African Tax Administration Forum led to the development of the first ever Africa-wide tax cooperation treaty, whose text was agreed by 21 African governments in 2012.This treaty will allow African countries to work together to investigate the tax affairs of multinational companies operating across the continent, a great step forward in the fight to raise more tax revenue. The first signatories and ratifications are expected during 2013.
Industry magazine International Tax Review described ‘Calling Time’ as “revolutionary in the way it captured the public’s attention,” and placed ActionAid on its 50 top influencers in international tax in November 2011.
In February 2013 the Economist magazine credited ActionAid’s SABMiller campaign with having "galvanised…tax authorities in emerging markets [to start to] push back against the multinationals".
ActionAid Sweden H&M and Swedfund - June 2010
In 2010 ActionAid Sweden published a report on H&M, showing that Bangladesh was losing out on $100m in taxes because of H&M’s corporate structure. Despite Bangladesh being one of H&M’s largest producers, in 2010 the company paid only 585 Swedish Krona in tax there.
On 24 June 2010 ActionAid sent a reminder from the people of Bangladesh to H&M's CEO Karl-Johan Persson to pay $100m in missing taxes.
ActionAid Sweden also revealed that Swedfund, the Swedish international development agency, was funding a company, Panafrica Energy, that was diverting profits to tax havens to avoid paying tax in Tanzania.
ActionAid Sweden has demanded that Swedfund stop investing in companies that avoid tax or use tax havens and that Swedfund should improve transparency and reporting of all companies it invests in to prevent tax avoidance.
Glencore/Mopani copper mine – February 2011
In February 2011 a confidential draft audit report was leaked to the Zambian media, alleging that that mining giant Glencore had minimised its tax liabilities in Zambia by selling copper to a Swiss subsidiary for below market price and inflating its operational costs.
ActionAid Zambia and ActionAid UK alongside the Centre for Trade Policy and Development (CTPD) launched a campaign to make Glencore and other mining companies pay their taxes.
As a result of the campaign:
- The Zambian government revised Glencore’s tax bill upwards in June 2011, nd in October 2012 announced some changes to Zambian tax laws governing mining companies, including measures to help stop the manipulation of trading and financing between mining companies’ subsidiaries
- In March 2011 the European Investment Bank announced that it would freeze further funding to Glencore and its subsidiaries.
Zambia Sugar/Associated British Foods – March 2013
In March this year, ActionAid UK and ActionAid Zambia released a detailed investigation into the tax affairs of Zambia Sugar, the operator of Africa’s largest sugar factory, controlled by UK food giant Associated British Foods.
The report became a global news story in the build up to the G8 Summit.
It caused huge debate in Zambia and ActionAid Zambia used it to launch a national campaign with public meetings and an SMS campaign where people sent messages of support from across the country.
As a result of the campaign:
- UK Chancellor George Osborneresponded to the story, saying: “Often the poorer a nation is, the more it needs the tax revenues, but also the weaker its capacity to tackle tax avoidance” and promising that the 2013 G8 meeting would crack down on tax dodging in developing countries.
- The Zambian governmenthas promised reform, and in April 2013 proposed new foreign exchange controls to stop bogus and excessive profit-shifting payments to offshore subsidiaries.
Multinationals in Zambia are promising reform. For example, Canadian mining company First Quantum Minerals pledged in February 2013 not to engage in tax avoidance and to progressively increase the amount of taxes due to the Zambian government.