Who Pays for What!

Activista volunteer at Isle of ShadyThe Tax Justice campaigners from Austria briefed that for every $1 in aid to developing countries, several dollars slip out through tax dodging. As much as US$255 billion is lost every year to governments around the world because of the no or low taxation of funds in offshore centers. And Also the IF campaign lunched in UK briefed, “Enough food for everyone IF governments stop big companies dodging tax in poor countries, so millions of people can free themselves from hunger”.

 The campaign is getting momentum in Bangladesh along with fiscal budget campaign. In budget campaign, we are asking about more allocation in education, health, employment sectors. Sometimes, government realized it, sometimes not! We are also observing an increasing trends of dependency on indirect tax of government for revenue generation that impacts on the lives of common people.

The tax justice campaign also focuses on the revenue generation for national development asking question, `why government generates revenue through an unfair system of taxation like expanding trends of indirect tax?” The campaign is justified with the answers. Corporations irrespective of national and abroad and riches dodges the tax through different ways and mechanisms. The government losses much more revenue than generated revenue from indirect tax where the tax justice campaign has given importance.

Tax Justice campaign introduces some academic terms  like tax avoidance, Tax evasion, transfer pricing, offshore and onshore etc. But an question arises that why we are not defining these activities related with these terms as corruption or corruption of multinational or transnational companies or corruption of riches?

When a company registered as a public limited company, it is treated as public property, said  Khaja Mainuddin in the workshop on Tax Justice organized by EquityBD and Tax Justice Network at Dhaka . Who will take responsibility to raise this question? The answer is, people, the civil society! Civil Society have responsibility to attack the anti-people policies continuously!

Recently, Bangladesh government is going to sign an agreement with United States named TRADE AND INVESTMENT COOPERATION FRAMEWORK AGREEMENT (TICFA) which has gained public concerns in the field of political arena. United States put pressure to Bangladesh to sign agreement on trade and investment from last decade of last century. All the consequences government delayed it. The present government also denied to sign Trade and Investment Framework Agreement (TIFA). But it also again come in the table of discussion when US government reviews generalized system of preferences (GSP) for Bangladesh. The US has threatened that it will withdraw the GSP benefit for Bangladesh if Bangladesh does not accept the TICFA. The President of BGMEA Safiul Islam Mahiuddin said a few days ago “Bangladesh does not get the GPS benefit that much anyway. We have to pay 750 million dollars in tax to the US government. Only 0.5 percent of Bangladeshi products enjoy the GSP. So it will not matter much if we don’t get this benefit.”

According to the agreement 97 percent of Bangladeshi product should enter the US market tax-free. Bangladesh has a market of 4.8 billion US dollars in the US. Only 0.54 percent products get the benefit of tax-free trading. 0.54 percent covers export worth only 26 million dollars. This portion of export includes tobacco, ceramic, furniture, plastic, and toys. The main export of Bangladesh, readymade garment products, does not get the GSP benefit. Bangladeshi traders pay 15 percent tax for export to the US.

An question arise, has TICFA have any relation with the Tax Justice campaign? We don’t know, because we have not read the agreement  but suppose, it has also a important link with Tax campaign! We need to search and observe!

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