Richard Murphy in the Guardian on a basic tax reform that could have very positive benefits….
…Something quite extraordinary is happening in the world of accountancy. The International Accounting Standards Board (IASB) that sets the rules on accounting for most of the world is considering a proposal for a new accounting standard put to it by civil society. This has never happened before.
The proposal is for a cut-down version of what is called country-by-country reporting. That concept is explained here, as are the benefits. The cut-down version, explained in chapter six of this IASB document, is more modest. As a first step towards full country-by-country reporting, campaign group Publish What You Pay (PWYP) has asked for country-by-country reporting to apply to just the extractive industries for now. That term applies to those companies that are engaged in the oil, gas and mining sectors.
What PWYP asks for is disclosure in the published accounts of multinational corporations engaged in the extractive industries of a breakdown of the sums they pay by way of taxes and similar charges to the countries that host their extraction activities. It also asks for disclosure of additional relevant information such as total sales by country, costs by country and reserves by country as well as the name of all local subsidiary companies so that the reasonableness of payments made and the legal identity of the local companies paying them can be determined.
The intention of the proposal is clear. PWYP, the Tax Justice Network and others who are behind this demand want multinational corporations working in this sector to be accountable for paying the tax that those in civil society believe they should pay to the societies that grant them the opportunity to make extraordinary profits. And at the same time, civil society wants this data so that they can hold governments accountable for the use they make of that money. (link to article)
