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The Prime Minister will host a series of meetings in London to encourage practical action on tax, trade and transparency.
48 hours before G8 leaders gather on the shores of Lough Erne, the Prime Minister will today issue a call to action to businesses, governments and civil society to back the UK’s G8 priorities aimed at boosting jobs and growth and reducing poverty.
G8 Open for Growth conference
Addressing the Open for Growth conference, the Prime Minister will say that eight years after the UK last hosted the G8, increased aid has tackled the symptoms of poverty and led to huge advances in developing countries.
But he will say it has failed to tackle the root causes of poverty: corruption, weak governance and institutions which lead to conflict and violence.
The Prime Minister’s G8 Presidency aims to forge a new agenda to focus on the causes as well as the consequences of poverty, supporting conditions that allow open economies, open governments and open societies to thrive and creating the economic growth that will lift countries out of poverty.
The Prime Minister will say:
For too long the international community has shied away from condemning the appalling degree of corruption and mismanagement of resources and the fundamentally bad governance that is destroying lives in some developing countries. And there are always voices saying: why cause the stir; why be the one to point the finger?
Well Britain has kept our aid promises so I don’t think we should hold back. Corruption is wrong. It starves the poor. It poisons the system. It saps the faith of people in progress. It wrecks the case for aid. When we see it we should condemn it utterly. I know some people put their hands up in the air and say this can never change. But by ending the era of tax secrecy and driving real openness over what governments and businesses do it can change.
But all this needs political leadership from the developed world too. We have the tools in our hands to tackle these problems. We can build international tax systems that make it easier for developing countries to collect the taxes they are due. We can ensure our extractive companies are accountable and transparent in their dealings and we can do more to promote trade in Africa.
And the extraordinary thing about this tax, transparency and trade agenda is that it’s not just the right thing for us to do morally, it’s right for our economies too because when some businesses don’t pay their taxes, it corrodes public trust. When some companies don’t play by the rules, it drives more regulation and makes it harder for other businesses to turn a profit.
And when Africa doesn’t trade to its potential, we all lose the chance to benefit from trading with one of the fastest growing continents on the planet. In short: getting this right is good for us and it’s vital for developing countries too.
Tax - getting our own house in order
Prior to the conference, the Prime Minister will meet leaders from the Overseas Territories and Crown Dependencies in Downing Street to discuss what they will do to tackle tax evasion and aggressive tax avoidance.
In the Cabinet Room, the Prime Minister will tell leaders from Bermuda, British Virgin Islands, Cayman Islands, Gibraltar, Anguilla, Montserrat, Turks & Caicos Islands, Jersey, Guernsey, Isle of Man that they need to play their part in ensuring that the UK gets its own house in order.
The Prime Minister will welcome the commitments made so far - joining our pilot on automatic information exchange and drawing up action plans that will require companies to have adequate and accurate information on who owns them and who controls them.
But he will argue that there is no point in dealing with tax evasion in one country if the problem is simply displaced to another and he will therefore ask them to go further by joining the existing Multilateral Convention on Mutual Assistance in Tax Matters.
He will stress that lower taxes are only sustainable if what is owed is actually paid – and if the rules to achieve this are set and enforced fairly to create a level playing field right across the world.
The meeting comes as the Prime Minister prepares to hold a working session on tax on the second day of the G8 summit, with the aim of securing explicit commitments from all eight leaders on concrete action to clamp down on tax evasion and tackle aggressive avoidance.