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From VOA Learning English, this is the Economics Report.
In Britain, demonstrators recently protested outside the Treasury to call on the world’s richest countries to act against tax havens. These are countries or territories that have low tax rates for businesses. Companies can place their profits in tax havens to avoid the higher tax rates of countries where they earned the income. An investigation found that tax havens cost Africa $38 billion every year in lost taxes. Former United Nations secretary-general Kofi Annan led the investigation. The demonstrators at Britain’s Treasury called on Chancellor George Osborne to discuss the practice with finance ministers from other wealthy countries. Melanie Ward is with the “Enough For Everyone If” campaign. She said she believes many people in Britain and the world oppose such tax avoidance.
Tax havens and low-tax countries like Ireland are popular. But critics of tax havens say big companies transfer profits out of the countries on which their income depends. Ronen Palan is a professor at City University London. He says capital in some African countries is funding development in other parts of the world because of such transfers. The charity ActionAid says the brewing company SABMiller uses a complex system of tax havens. It says this system moves profits out of the company’s operations in developing countries like Ghana. SABMiller denies any tax abuses. It says in 2010 it paid about $250 million in corporate taxes in India and sub-Saharan Africa. British Prime Minister David Cameron has promised to discuss the issue of tax havens at the G8 leaders meeting in June.
