All this week the Tax Justice Tour has been travelling around Scotland. This seven-week tour around 50 towns and cities across Britain and Ireland has a message of tax justice for poor communities locally and globally. The iniative has educated, inspired and equipped those who have boarded the bus and engaged with the complex issue of tax law.
Hopefully the impact will continue to unpack itself as they pass on what they’ve learned: that tax avoidance is a devastating wrong, morally unacceptable and something we can no longer tolerate. It has a particular sting in an age of austerity and spending cuts. It effectively amounts to robbing the poor, in the UK and in poor countries, of the money that should be spent on education, health and welfare.
But today, on the tour’s last day in Scotland, I pose the question: Whose job is it to make sure that people pay their taxes fairly?
On the one hand there is clearly an issue with very wealthy individuals, companies or institutions using immoral or unjustifiable (or even illegal) means to avoid tax.
There is also a question of what Governments can do in terms of regulations, enforcement, prosecution and closing tax loop-holes.
Christian Aid and the Church of Scotland have also asked for reforms to the international accounting system for large multinational corporations, to ensure transparency in reporting of how much tax they pay and where some tax dodging schemes are cloaked in secrecy and so making corporate accounts report what they do in each country would be one way in shedding light on dodgy practices.
And does society, the media, political and community leaders, the churches, have a role in setting out what is and what is not ok? We need to make the concept of tax dodging as socially repugnant as racism; it is sinful, it is evil, it is harmful. On this last day of the tour in Scotland - as the bus pulls out, we need to recognise that we all have a part in this complex mess. If there is a change coming, then we all need to get on-board!
Scottish Church Leaders in Edinburgh with the Tax Bus yesterday
The Tax Justice Tour continues its journey across Scotland today. Having had stops in Dumfries and Alloway, Glasgow and Edinburgh earlier this week, today it is in St Andrews before travelling on to Inverness tomorrow.
Yesterday I got a chance to visit the Tax bus as it sat in Bristo Square in Edinburgh. Now I have to confess that I find understanding finance “challenging!”When it comes to numbers, I feel a cloud of confusion descending on my brain and a strong urge to bury my head in the sand follows; however, I have come to the conclusion that this issue is too important to ignore.And I have begun to realise, as I meet and talk with others for whom the penny has dropped, others who have also begun to engage with the issue of tax justice, that perhaps my urge isn’t unique – perhaps big corporations actually count on our ostrich-like inclinations.
We cannot allow that to be the case anymore – our brothers and sisters who are daily being more marginalised by the extreme profit margins of tax-dodging companies are counting on us to start counting the tax cost.
As I visited the bus, I was struck by the potential impact of this awareness-raising, education- offering tool! I met dedicated people whose knowledge and commitment to seeking tax justice planted seeds in others who left more informed and more empowered. Hopefully, they will go out and spread the message; hopefully they will be encouraged to believe that their voice can make a difference - write messages to leaders or go on rallies or lobby centres of power. Hopefully they will not go back to the default position of adopting the ostrich position.
If you’ve not been able to get to the Tax Bus or if you’d like more information about tax justice, then Christian Aid Scotland and the Church of Scotland are happy to come to speak to your congregation or a group linked with your church.Please get in touch by emailing churchandsociety@cofscotland.org.uk
We’ve also prepared some prayer and worship resources on the theme of poverty and tax which you are welcome to download and use. October 17th is International Poverty Eradication Day - a great chance to use these resources to engage with this complex issue.
I’ve been blogging about issues around Tax to mark the visit of the Tax Justice Tour to Scotland this week.
Today the Bus visits the Scottish Parliament, where there will be an opportunity for MSPs, Parliamentary researchers and others to board the bus and find out more about what Christian Aid and Church Action on Poverty are calling for.
Neil Findlay MSP, who represents the Lothians, has achieved cross-party support for his motion, which I’ve copied below.
If you are reading this and live in Scotland, please consider writing to your MSPs asking if they have signed the motion, and if not, to do so!
One of the challenges we face is that however sympathetic Scottish politicians might be to the cause of greater transparency, accountability and responsibility in the tax system, the only real change will come from wealthy individuals and institutions changing their attitude to tax dodging.
As a lot of these issues touch on global trade and economic policy the UK Government and Westminster Parliament need to be convinced as well; but with support at every level of power, influence and leadership, hopefully the message that the system has to change can be heard loud and clear.
The Tax Justice Tour website allows you to sign an online petition to add your name to a list which will be presented at the end of the Tour to the Prime Minister.
Motion S4M-04217: Neil Findlay, Lothian, Scottish Labour, Date Lodged: 20/09/2012
Christian Aid, Tax Justice Bus
That the Parliament commends the work by Christian Aid and Church Action on Poverty in taking their Tax Justice Bus around the UK and Ireland raising awareness of tax dodging; notes Christian Aid’s estimate that the global culture of financial secrecy costs the developing world $160 billion every year, which is one and a half times what is delivered in international aid; understands that, in the UK, the poorest people are also worst affected by the impact of tax evasion and aggressive tax avoidance; notes that the Tax Justice Bus is in Scotland between 1 and 5 October 2012, stopping in Dumfries, Alloway, Glasgow, Edinburgh, St Andrews, Inverness and Inverurie, including a stop outside the Parliament on 3 October to allow MSPs and parliamentary staff to meet campaigners, and welcomes the opportunity for people to get on board the tax bus and find out why tackling tax dodging is so important in the fight against local and global poverty.
So get on board by signing the on-line petition, by writing to your MP and MSP, by telling your friends and neighbours that they too can get on-board. There’s plenty of room on the bus!
I am blogging about Christian Aid and Church Action on Poverty’s campaign for tax justice this week.Like the Olympic Torch relay, the Tax Justice Tour is travelling to communities across Britain and Ireland seeking to raise awareness about the injustice of tax dodging.For all of this week the Big Red Bus is in Scotland.
Christian Aid estimates that around $160 billion a year are lost to developing countries’ governments because of tax dodging by wealthy individuals and institutions.This sum is greater than the global international aid budget. It means that poor countries do not benefit from the tax revenues they are entitled to, and these unethical practices are harming education, healthcare and infrastructure; keeping the poorest in the world poor while the rich avoid paying their fair dues.
Access to clean drinking water remains a major problem in Bangladesh. Yet the money Bangladesh lost between 2005 and 2007 as a result of trade mispricing with the EU and US – an estimated £184m – could have been spent on establishing safe drinking water for much of the population.
In Bangladesh, water is simply not on tap. A quarter of the population lives without sustainable access to improved water. Millions of women and children spend hours travelling just to quench their families’ thirst. As a result, children lose out on education because, rather than filling their brains, they are filling up buckets.
Minu Basar crossed a wide and sometimes dangerous river travelling up to 10km to buy fresh water at vast expense for her family. ‘I used to feel so scared going to fetch the water because it was often windy and it was frightening because of the waves.’
Christian Aid partner Bangladesh Centre for Advanced Studies has worked in villages across southwestern Bangladesh such as Minu’s to establish Pani Parishad, or village water councils, which provide community-based approaches to delivering sustainable water solutions.
Minu did not know she had the power or the voice to change things until she joined the village Pani Parishad. Through the Pani Parishad, Minu has learned how to safely gather and store rainwater and how to inspire others to do the same.
Taxes aren’t burdens, things to be “relieved” or “sheltered” from: they certainly aren’t there to be dodged. Taxes are an investment in the society you are part of and benefit from. It is time to call time on tax dodging!
This week the Tax Justice Tour comes to Scotland. This big red London bus is travelling around the UK to promote awareness of tax dodging, it is being managed by Christian Aid and Church Action on Poverty.
Today I want to write about tax and theology, and to share with you the following ideas, adapted from the joint Church of Scotland – Christian Aid report on the subject, Paying their dues: how tax dodging punishes the poor.
Tax evasion – a challenge to citizenship and discipleship
The conviction that God is sovereign over every part of life, not just our religious or church life, is central to Reformed theology. There is no division between ‘sacred’ and ‘secular’, no ‘no-go areas’ for discipleship. The Church of Scotland has always held that our politics and economics are as much legitimate arenas for our Christian faith and practice as our prayer lives.
Widescale tax dodging, whether legal or not, is problematic from a Christian perspective. In a democracy, citizens enter into an unspoken contract with regard to taxation. Complain about it as we do, debate appropriate levels as we should, there is an implicit understanding that paying our taxes is part of our civic duty.
Jesus asked hard questions about taxation. He challenged people to make difficult moral decisions, and then live them out as adults who had the capacity for free will. How shall we live? Whom shall we serve? You decide. He asks the same questions of us today. What are your fair dues?
The gospel resistance to taxation was not to the principle.
Rather, it was based on two realities. First, the taxation system weighed particularly heavily and unjustly on the people who could least afford it. Jesus’ concern for the poor is central to the gospels; in Matthew 21, we read that he overturned the tables of the money lenders in the temple, where the very poorest were subjected to a kind of loansharking in order to be able to make their temple offerings. To fulfil the requirements of the law, it was necessary to make sacrifices of small animals, birds or money. A brisk business trading in these went on, right inside the temple courtyard. But the poor, the majority, had either to borrow the money to buy the offerings, or couldn’t afford them at all. If you borrowed, you weren’t in a position to bargain – you just had to take the rate you got and stand a good chance of being fleeced. So the only choice was either to get into debt to fulfil your obligations, or default on them, find yourself classified among the sinners, and be excluded from the number of the righteous. You didn’t have to do anything we might consider morally wrong to be a sinner, you just had to be poor.
The second reality was that the taxes were being collected on behalf of an occupying power, the Roman Empire. Tax collectors were not hated because they collected taxes, but because they were considered to be traitors by doing so for a foreign power. And they were despised because they were also often engaged in malpractice and extortion. Tax collecting was franchised – the tax collector paid an amount to the authorities for the contract to collect money. Whatever he collected over and above the due amount was up to him.
Corruption was built into the system.
In Matthew 22, a loaded question about taxes was posed to Jesus. It was not just about money, it was about power. Jesus was being confronted here by a rather unlikely alliance. The Pharisees were nationalistic Jews, middle-class anti-Romans. Those of Herod’s party were collaborators with Rome, urbane upper-class people who knew and played the system well, and were adept at managing the compromises involved in sharing power with Rome. The two groups were traditional enemies. But even more than they despised each other, they feared the challenge presented by Jesus, the rural upstart who proclaimed the rule of God, which they purported to represent, and championed the poor. So they put aside their differences in another attempt to trap Jesus and make him stumble before their political power.
They began by trying to flatter Jesus into giving himself away. The question was: ‘Is it against our law to pay taxes to the Roman Emperor or not?’ If Jesus said, ‘pay’, then he would reveal himself as a collaborator, a traitor, and discredit himself in the eyes of most Jews. If he said, ‘don’t pay’, then he was open to charges of lawlessness and criminality. Jesus knew they were trying to trap him, so he answered their question with another question. He asked for a coin. The unspoken implication was that he did not have one himself, and if he had no money, then he wouldn’t be paying any taxes. But he never actually said so. When the coin was produced, he asked them to describe it. The face was the Roman Emperor, the inscription underneath ‘Son of the Divine’, blasphemy to any devout Jew. The claims of Caesar, depicted on his money, were not only economically and politically oppressive, they were idolatrous, claiming an authority which belonged only to God. But Jesus would not be constrained within the limits of the question he was being asked. By calling for the coin, Jesus sprung the trap set for him. And by turning the question back to them, he caught them in their own trap.
Now they were the ones who had to declare themselves. In his final statement, ‘render to Caesar the things which are Caesar’s and to God the things that are God’s, Jesus drew another distinction between himself and the Pharisees. They talked of paying taxes. Jesus spoke of ‘giving back’ (and the Greek makes it clear these are different things). What Jesus referred to was a submission to authority.
This text has sometimes been used to justify a rigid separation of faith and politics, to assert that God and money have nothing to do with each other, that the things of God belong in a spiritual realm while money belongs to a material realm from which faith must keep its difference and its distance. But Jesus demonstrated that people’s values and motivations, their spirituality, showed up precisely in how they used their money. And no Jew in Jesus’ audience would divide reality between the power of God and the power of Caesar. On the contrary, many believed that Caesar had usurped God’s authority and must be driven out by armed revolt.
A spiritual challenge
Jesus’ words presented a huge challenge to his listeners, and they still do to us today. Were the Pharisees, in their opposition to paying taxes, driven not just by nationalistic fervour but by their own love of money and indifference to the plight of the poor, whom they subjected to religious exclusion? Were the Herodians really motivated by concern for good order and the safety of their fellow Jews, or rather by the power and influence their collaboration gave them?
Were the onlookers looking for easy answers from the party that would tell them what to do and save them having to make hard moral choices themselves? Jesus’ words and actions depict a very subtle position. He accepted neither the authority of the Sanhedrin, the religious power, nor that of Rome, the military power. But neither did he sanction open, and certainly not armed, revolution. He changed the terms of reference, and questioned the very nature and legitimacy of authority. Money, good order, political influence – all have a claim and a role. But all are subject to the authority of God, to God’s justice and mercy, and that meant a radical reordering in favour of the poor and dispossessed. If money was your god, you needed to be liberated from that attachment; if power, then that too was a chain. And in the face of all these competing claims, no one was going to allow you to shake off your responsibility and hide behind others. You had to decide for yourself as to the weighting you gave each of these claims. And your choices would show up what your spirituality really was.
In the context of deep poverty and insecurity for the vast majority of the peasant population, disturbance and dissatisfaction were rife. As Kenneth Leech writes: ‘The climate of colonial rule, oppressive taxation, accumulating debt and bankruptcy, forced migration and revolutionary uprisings, formed the background to Jesus’ proclamation of the Kingdom of God.’
His call resonates today with as much relevance. Tax evasion by wealthy and powerful companies and individuals causes grief to those who can least tolerate it, misery to those who have more than enough share in that. Proper taxation is an investment into the communities we are a part of, whose flourishing means we too can flourish. Companies who take advantage by embracing the benefits of a country and then refusing to put anything back into them are as guilty as the tax collectors and collaborators in Jesus’ day. The characters may have switched places, but the result is the same: misery for those who have no way to fight back. Join Christian Aid in fighting for them.
Tax evasion by a mining company in Zambia has come to my attention this week. Zambia is an African nation blessed with many natural resources and a country where we as a Church gladly serve as part of our World Mission work. Managed well the revenue generated from the extraction and sale of the abundant natural resources could be, potentially, a great source of income for Zambia. However, this has not been the case. These mineral reserves have been a curse for the majority of the population meaning poverty for most, in the midst of plenty - for some.
This issue has come to a head this year in light of elections which will be taking place across Zambia later this month. There is not much ideologically that separates the main parties, politics here tend to have more to do with personalities. However, the use of the county’s natural resources is in issue which engages all parties. The key concern is this: that mining multi-nationals are being accused of a lack of financial and fiscal transparency, violating the human rights of their employees and showing a disregard for the environment.
One multi-national operating in Zambia in particular has hit the headlines this year: Mopani Copper Mines, one of Zambia’s biggest producers of copper and cobalt. It has been reported that Mopani ‘sold’ its Zambian copper and cobalt at a price lower than that set by the London Metal Exchange to its Swiss parent company, Glencore. Glencore hedged and then sold on the copper when the price was higher so as to maximize profits. Between 2003 and 2008 it is reckoned $700m was made in this way. According to World Trade Organisation (WTO) figures in 2008, over half of Zambia’s copper production was ‘exported’ to Switzerland. Cobalt received the same treatment. Moreover, you may also be interested to hear that Mopani received 48m Euros in early 2005 from the European Investment Bank (EIB) to help contribute to sustainable development in Zambia. This funding has since been stopped.
There is a Memorandum of Understanding with the Zambian Government which gives Mopani a number of tax reduction and exemptions. Yet still Mopani claims to make no profit further reducing its fiscal obligations. A recent audit reported Mopani resorted to the following ploys to evade taxation in Zambia:
Overestimating the costs of mining and extraction
Underestimating the volume of production
Price-fixing and avoiding competition.
Aside from violating good practice in line with OECD guidelines the more important issue is that the greed of this multi-national company has prevented huge sums of money from being re-invested into Zambia, thus keeping Zambia poor.
Jesus tells a story about the fruits of such shameless greed: the parable of the Rich Fool (Luke 12: 13-21). A man stores all his earthly treasures up in barns, and when these barns are full he tears them down to build bigger ones. He flatters himself and is overjoyed at all he has made, at just how rich he has become: “it’s all mine!” He plans early retirement and on spending the rest of his life taking it easy. The message for this man from God is clear-cut: “You fool.” This is how it is with those who pile up riches for themselves but are not rich in God’s sight – the treasure they store up here for themselves will not last. There is no space for greed in God’s kingdom.
Being rich in God’s sight is far more important than any profit margin, revenue level or tax-evasion scheme we could ever dream of devising. For Christians this richness means loving God and living for Him. The Bible, God’s word for us to live by, demands that we do all we can to alleviate poverty. So I ask that you join with me in praying for the people of Zambia as they go to the polling stations on the 20th September. That the government they choose to elect would take a bold stance against the greed of multi-national co-operations whose conduct would have Zambians remain in the grip of poverty.
It was reported last month that £9 in every £100 that should have been paid for in taxes, actually goes missing because people, as well as corporations are very efficient at evading tax. In 2009 this amounted to an estimated £42 million. This is a tricky issue. Should we do everything we can to avoid participating to the costs a society that tries to be fair and provide for its most vulnerable members? Is tax dodging ethically defensible for individuals and corporations?
The question of immoral tax evasion and avoidance lead the Kirk in the General Assembly of May 2010, to study the issue further. I am delighted to see that Christian Aid will be issuing on Monday the 18th a report called “Paying our Dues” which explores the ways by which tax dodging punishes the poor. The Church and Society Council of the Kirk collaborated with Christian Aid in the report and fully supports its vision and philosophy.
As a Christian, I cannot but support the position that it is ethically appropriate to pay our fair dues to the running of the society in which we work, play and make our livelihood.
