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Code of Conduct for Taxation

The more we look at taxation reform in Ireland, the more we realise that the reform has to be considered in a global context.  Feasta supports a shift from the taxation of income, transactions  and profits even (when they equal those of income) to privilege or to be more exact, the use of various natural and virtual commons.  In other words, we want an end of the free lunch than landowners enjoy from value created by all our actions, the free use of atmosphere as dump that threaten our very existence, theft of our collective scientific and cultural knowledge base through predatory patents and copyrights, the capture of private banks of the right to create legal tender money and charge us for it – a short indicative list.  This kind of comprehensive reform would make tax avoidance and evasion very difficult.

But we are not holding our breath that such reform is imminent – and meanwhile the current tax system is being abused by a financial sophisticates with flexible morality.  Our own Bono is a very public example.  But there are many much worse and unconscionable schemes being devised and implemented to avoid paying legitimately imposed taxes in jurisdictions globally.  This scheming appears to be abetted by international and national governance complaisance and even complicity in some cases.  Of course many national authorities have much to gain by lax regulatory or light touch taxation environments – our own is climbing the dodgy line out list.

The Tax Justice Network has been a terrier snapping at the heels of regulators to take action.  Here is Richard Murphy’s of Tax Justice and of Tax Research UK proposal for a new Code of Conduct  for taxation regulation.

“I have drafted such a Code for the Tax Justice Network and for the Association for Accountancy and Business Affairs in 2007. This is available here. The actual Code is just two pages long and reads as follows:

A Code of Conduct for Taxation


This Code of Conduct relates to the payment of taxes due to a State or other appropriate authority designated by it.


This Code applies to:

  1. Governments and their agencies in their role as tax legislators, assessors and collectors;
  2. Taxpayers, whether individuals, corporate bodies or otherwise;
  3. Tax agents, whether they are undertaking tax planning or assisting with tax compliance.


It is intended that this Code be voluntarily adopted by States and should be used to guide the conduct of taxpayers and their agents who choose to comply with it whether or not they reside in a State which has adopted the Code.

The Code

The Code is divided under six sections, each of which includes three statements of principle.

1. Government

a. The intention of legislation is clear and a General Anti-Avoidance Principle (‘Gantip’) is in use;

b. No incentives are offered to encourage the artificial relocation of international or interstate transactions;

c. Full support is given to other countries and taxation authorities to assist the collection of tax due to them.

2. Accounting

a. Transparent recording of the structure of all taxable entities is available on public record;

b. The accounts of all material entities are available on public record;

c. Taxable transactions are recorded where their economic benefit can be best determined to arise.

3. Planning

a. Tax planning seeks to comply with the spirit as well as the letter of the law;

b. Tax planning seeks to reflect the economic substance of the transactions undertaken;

c. No steps are put into a transaction solely or mainly to secure a tax advantage.

4. Reporting

a. Tax planning will be consistently disclosed to all tax authorities affected by it;

b. Data on a transaction will be consistently reported to all tax authorities affected by it;

c. Taxation reporting will reflect the whole economic substance and not just the form of transactions.

5. Management

a. Taxpayers shall not suffer discrimination for reason of their race, ethnicity, nationality, national origin, gender, sexual orientation, disability, legal structure or taxation residence; and nor shall discrimination occur for reason of income, age, marital or family status unless social policy shall suggest it appropriate.

b. All parties shall act in good faith at all times with regard to the management of taxation liabilities;

c. Taxpayers will settle all obligations due by them at the time they are due for payment.

6. Accountability

a. Governments shall publish budgets setting out their expenditure plans in advance of them being incurred, and they shall require parliamentary approval;

b. Governments shall account on a regular and timely basis for the taxation revenues it has raised:

c. Governments shall account for the expenditure of funds under its command on a regular and timely basis.


States seeking to comply with the Code will voluntarily submit themselves to annual appraisal of their Conduct. These appraisals will in turn be reviewed by a committee of independent experts appointed by participating States. Differences of opinion will be resolved by binding arbitration.

Any taxpayer or agent wishing to comply with the Code may do so. A State should presume that a person professing compliance with the Code has done so when dealing with any tax return they submit. In consequence the administrative burdens imposed upon that person should be reduced. In the event of evidence of non-compliance being found any consequential penalty imposed should be doubled.

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  1. Richard Murphy says

    Many thanks for posting this