Zambia is losing $3 billion a year from corporate tax dodging according to a new report launched by War on Want.
The sum is equivalent to nearly twice Zambia’s spending on health and education.
The report titled ‘Extracting Minerals, extracting Wealth: How Zambia is losing $3 billion a year from corporate tax dodging ’, examines the Zambian operations of Glencore, Vedanta and Associated British Foods, companies based in the UK or listed on the London Stock Exchange.
The report focuses on the complex corporate structures and mispricing that robs Zambia of revenue that could fund essential public services.
It highlights how the ability of companies to get away with tax dodging depends on the willingness of governments around the world to allow them to do it.
Owen Espley, Economic Justice Campaigner at War on Want, said this is a staggering sum of money to lose in a country where 74% of the population live on less than $1.25 a day.
He said this scale of tax dodging is depriving the Zambian people of revenue that could fund vital healthcare, public services and anti-poverty programmes.
Public outcry over lost tax revenues led to Zambian government attempts in 2014 to address how mining companies avoided tax.
These attempts were powerfully opposed by mining corporations, who threatened to cut thousands of jobs and billions of dollars of investment.
“While ordinary Zambians are being stripped of their wealth and power, the actions of the UK government continue to undermine Zambia’s attempts to collect tax revenues.
“George Osborne must abolish the UK network of tax havens and investigate the UK companies at the heart of this global extortion racket that is depriving Zambia of schools and hospitals.
“Global tax rules need rewriting, but this cannot be left to a rich nation’s club like the OECD. Developing countries must have an equal seat at the table, and until they do we will continue to see global corporations abusing their power and robbing nations of their wealth.”
Very sad,indeed. I ll fully support any presidential candidate who can promise and manage to get us this money.
Bring Politics and every jim and jack will comment on the post. tell them about how they are losing money and nobody comments. not even understand. go on the street and give the people this info and they just walk away without a care in the world.
Edgar and his cohorts in Cabinet have no skill to detect this kind of corporate fraud. It is just common sense that we need a leadership that knows and understand complex corporate dealings. For a millionth time, Edgar with his no vision is the wrong guy
African bupubafye.I have been saying that let us invest in science and techology but nothing is happening.We need proper systems to monitors what goes out of the country.Upto now nothing is known.Even govt officials use systems made by european.All those systems are easely manupulated by owners when they are stealing.Iwe kuti wafenta nabasungu and indians.When u want to implement gud systems then fake economist comes ati u’re scaring investors if have these systems.Bane ubupaba katuleke.There is no way we can lose this money if we were serious as govt and zambians.The problems zambian can sell their own country coz of love of money.Please twapapata help the country u Zambians.Stop loving cars and women
Thats what they are in Zambia for…to make money at any opportunity that avails itself. There is need of tight monitoring of the mines’ accounts books but we know that ZRA is oiled. What a shame for ZaMBIA.
What is sad about all this, is that they are helped in doing so by some ‘smart’ highly trained Zambians, some of whom were trained at great cost to the taxpayers.
The same suspects causing problems (Glencore, Vedanta and Associated British Foods, companies based in the UK or listed on the London Stock Exchange).
Can we temporarily break off diplomatic and any parallel agreements until UK behaves better? Well we must try try something……dialog alone or pictures of babies with begging bowls is not working on Osborne.
Guys,
Without these foreign investors, your copper would have been rotting in the ground.
Who would have given your school kids exercise books and lead pencils?
Solwezi would have been A DEAD TOWN!
Monies generated in Zambia should be banked in Zambia, not Switzerland, UK Virgin Islands. Thats the only way the Kwacha can be saved. Chile is also copper dependent but the contrast btwn Lusaka & Santiago is light years apart.
Just google images of Santiago, you’ll see what I mean.
In my view as a general rule we do not need foreign investors. If it means minerals rotting in the ground (as commented by Charles Williams above) so be it because we do not benefit from the God given resources (they are diminishing by the minute due to mining) and yet we enrich strangers called investors whilst Zambia gets poorer and poorer. If they are (foreign investors) to invest in our land it should be on our terms and win win situation mostly for us. Otherwise they should not be encouraged to come in. True they control the markets and international trading but once we withhold our resources all that will be futile in the long run. We have weak exchange controls and no measures to penalize transfer pricing (the scheme investors use to avoid paying tax in Zambia). Botswana has…
Botswana has managed its minerals very well why not cross the ditch and get ideas from them.