IMF Managing Director Christine Lagarde considers it a disgrace that multinational companies use their global reach to exploit loopholes and off shore tax havens to avoid paying taxes.
She also said that it was difficult to understand why national policy makers are not more proactive in addressing this issue. Ms Lagarde was responding to a request made by EI General Secretary, Fred van Leeuwen, at the G20 summit in Los Cabos, Mexico. He said that IMF should play a more active role in closing those fiscal loopholes through international regulation. He also asked that countries stop lowering corporate tax rates to attract global corporations to settle within their national borders.
Van Leeuwen said that in many countries austerity measures are now putting vital public services and equal access to quality health care and education services at risk, while trillions of dollars are lost annually to our communities due to tax avoidance. Ms. Lagarde was presented with a global union study commissioned by the Education International Research Institute: “ Global Corporate Taxation and Resources for Quality Public Services”. The study, published in December 2011, supports the claim that a large part of the national debt burden could be wiped out were governments to work together more effectively in preventing aggressive tax planning by international corporations.
111