ActionAid: Microsoft, Facebook and Google Must Pay More Taxes in Developing Countries
The aid charity ActionAid estimates that developing nations are missing out on around $2.8bn tax revenue. This a huge amount that can be used to deal with the coronavirus pandemic. ActionAid is urging the tech giants to pay an international minimum tax rate.
Microsoft and Facebook refused to comment. Google, on the other hand, didn’t respond immediately for comment.
Multinational tech corporations are presently not required by law to disclose the amount of tax they pay in poorer nations. Billions might be at stake here. This is a significant amount that can be used to fund education and health systems in developing countries, since tech companies have reported increasing revenues even during the COVID-19 pandemic.
ActionAid wants to witness the creation of a new global tax system, preferably by the United Nations. In this system, big corporations need to pay an international minimum corporate tax rate that is reflective of their genuine economic presence.
ActionAid says that $2.8bn can be used to pay for 879,899 primary school teachers, 770,649 midwives, or 729,010 nurses yearly in 20 countries across South America, Asia and Africa. According to its research, the developing countries with the highest tax gaps from Microsoft, Facebook and Google are Bangladesh, Nigeria, Brazil, Indonesia and India.
Young people and women are paying a huge price for an outdated system allowing huge tech businesses to rack up big profits even during a health crisis, David Archer said. He is ActionAid International’s global taxation spokesperson. He said that the tax gap of $2.8bn is really just the tip of the iceberg, since their research only covers three technology giants. Alone, the money that Alphabet (owner of Google), Microsoft and Facebook would be paying can transform the lives of millions of individuals.
Tax avoidance issues
There have long been concerns that huge corporations don’t pay much tax in developed countries. They reroute the profits through several low-tax jurisdictions. Amazon, Apple, Google and Facebook have settled disputes with French tax officials over their operations in their country over the past 10 years.
Back in April, the United Kingdom launched a new online sales tax forcing technology companies to pay more.
In February, Facebook big boss Mark Zuckerberg said he acknowledges the public’s frustration over taxes paid by companies like his. He accepted the fact that soon, it might need to pay more under a new framework.
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