How the tax fight is being won

Guest post from Alice Macdonald, Save the Children’s head of action/2015 campaign, @alicemac83.

As part of Save the Children’s History of Change series (see more here and here), Alasdair Roxburgh (previously Head of Campaigns at Christian Aid) talked us through the history of the tax movement.

It was an inspiring talk (you can listen to the whole thing here) about how campaigners around the world managed to turn tax – which let’s be honest isn’t the most exciting of subjects –  into a big political issue and achieved changes which will help to ensure that millions of people around the world benefit from the tax revenues which belong to them.

Though tax may not be sexy – it matters. It matters for the obvious reasons – it provides the services we all need whether we live in the UK or in Tanzania – hospitals, schools, roads. It can encourage good behaviour like saving money through ISAs and discourage bad habits through increasing the price of things like cigarettes. If we use it well tax can help reshape the world. And it also matters for less obvious reasons – by paying tax we sign up to be active citizens contributing to improving the world around us.

But to date the tax system has been skewed towards the interests of the richest in society. It’s notoriously hard to put an exact number of how much money is lost through tax dodging but estimates put it at hundreds of billions lost from some of the world’s poorest countries. There is no doubt that tax dodging costs lives. The money lost could be spent on vital services like healthcare. That’s why the tax justice movement was born.

It got off to a pretty technical start with the conversation pretty much confined to the policy wonks. It was only when the financial crisis hit in 2008 and stories about corporate giants hit the headlines that it really moved up the political and public agenda. That was a turning point for the movement and it began to strengthen and now counts hundreds of organisations around the world from big NGOs like Oxfam and ActionAid to grassroots organisations, faith networks, student movements and trade unions.

It hasn’t been an easy ride, especially in the early days of the campaign. Governments and companies repeatedly slammed the door in campaigners’ faces and organisations like Christian Aid were even labelled the “Tax Taliban” by opponents. But despite the hurdles, the tax movement has already achieved some major wins – getting tax on the agenda at the G7, a law on EU transparency and the Dodd Frank Act which both mean that extractive companies are obliged to publish how much tax they pay on a county by country basis. The campaign also transformed the narrative around tax, taking it from the technicalities to an issue of justice helping to rally people around the world to challenge a financial system in which let the richest get away with robbing the poorest.

What can we learn from the movement for future campaigns? There are 5 key lessons:

  1. Persistence pays off: it took 5-6 years to secure the first big campaign win. Campaigners need to be ready for the hard slog and not expect instant results.
  2. Change your tactics and targets: the campaign mixed it up from private lobbying, targeted actions, hard-hitting reports and stunts and identifying targets and supporters from MPs to corporate champions.
  3. Nothing is too complicated to campaign on: at the beginning the campaign didn’t talk about values and got too tied up in the technicalities. When the campaign turned tax into an issue of social justice it really took off. So don’t always focus on facts and stats but focus on values and the impact on people.
  4. Small targeted campaigning works: You don’t always need to make a big noise to achieve success. For example securing the European directive on country by country reporting for extractive industries was secured by a very specific targeted e-action.

Of course the fight isn’t over yet. In September, the world agreed an ambitious agenda to end poverty, inequality and fight climate change – the new global goals for Sustainable Development something which as Head of action/2015 I’ve been closely involved in campaigning for along with millions around the world.

That ambition won’t be delivered without money and tax will be a crucial part of finding that finance. Ultimately the whole global financial system needs to change so that the world’s richest governments and richest companies are no longer able to dictate the terms of engagement and countries are able to operate on a level playing field. We need to strengthen legislation, ensure it is complied with and make sure that citizens are able to hold their leaders to account.  The fight isn’t over yet but the strength of the movement gives us plenty of room for optimism.

Alice Macdonald is the Head of the action/2015 campaign at Save the Children. Action/2015 is a global coalition aimed at securing ambitious action on poverty, inequality and climate change which has mobilised millions of people this year.  She has worked in international development for the last decade holding a variety of roles across campaigns, policy and advocacy.

The Problem with Fossil Fuel ‘Subsidies’

Like all right-thinking people, I am passionately opposed to fossil fuel subsidies. What could be worse than paying people to accelerate the rate at which we are screwing the climate?

So I was shocked to discover – courtesy of Bloomberg’s coverage of the climate talks in Doha – that:

Rich countries spend five times more on fossil-fuel subsidies than on aid to help developing nations cut their emissions and protect against the effects of climate change.

Even worse, when I tracked down the report that Bloomberg had drawn their story from, I found that the UK is one of the worst offenders.  According to the campaigning group, Oil Change International, the British taxpayer shelled out $6.6 billion in fossil fuel subsidies in 2011, but pledged only $793 million in ‘fast-start climate finance” that year.

Outrageously, for the UK, subsidies are over eight times greater than climate finance. I simply had no idea that the government of my own country was pumping so much money into oil, gas, and coal. Quite embarrassing really.

So where does this money go? Margaret Thatcher shut down the UK’s coal industry, while I’d always assumed that North Sea Oil was profitable without subsidy. Motorists, meanwhile, are always complaining about how much additional tax they pay on petrol and diesel (Daily Mail: “We’re the fuel tax capital of Europe.”)

Who then is getting 6 billion dollars a year?

(more…)