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OECD calls for crackdown on tax avoidance

Guardian  Paris, February 13, 2013
First Published: 21:10 IST(13/2/2013) | Last Updated: 21:11 IST(13/2/2013)

Governments need to urgently modernise their tax systems to catch international companies that dodge billions of pounds of corporation tax, the Organisation for Economic Cooperation and Development warned on Tuesday.


The ease with which firms shift profits around the world to offshore havens is undermining the ability of governments to recover from the financial crisis and shows that tax authorities need to step up their anti-avoidance efforts, the Paris-based thinktank said in a report.

Angel Gurria, OECD head, said the G20 needed to act this year. Failure to crack down on “the big guys” would leave small and medium-sized businesses and middle-income taxpayers to pick up the tab for vital public services.

The report comes just months after Starbucks promised to pay £20m in corporation tax in Britain, despite a loss in its UK subsidiary. Foreign firms that pay little or no corporation tax, including Google and Amazon, have justified their stance, saying they use tax avoidance rules allowed under UK law.

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