Osinbajo tasks African tax experts on transparency

Vice President Yemi Osinbajo has challenged African tax administrators to address issues around Base Erosion And Profit Shifting (BEPS) and increase transparency in resource mobilisation.

The VP made the call yesterday in Abuja at the opening of an international conference of Africa Tax Administration Forum (ATAF).

He said information sharing involved establishing automatic information exchange as the new global standard for cooperation in tax matters and ending legal secrecy of ownership of companies and trusts, especially those based in tax havens.

He said the continent also needed to ensure transparency and information sharing among member states.

Osinbajo said containing the Base Erosion and Profit Shifting, which has also done significant damage to domestic resource mobilization in Africa, a range of potential actions are planned by OECD countries.

“The forum had committed to this cause since August 2008. After the international conference in 2008 on a somewhat similar theme: ‘Taxation, State Building and Capacity Development in Africa’, senior tax administrators and policy makers from 39 African countries agreed to work towards the “establishment of the forum as a platform for sharing best practices in taxation matters in the region,” he said.

He noted that “the tax problems of African states have remained much the same in complexity and character.”

“The constraints are similar though in varying degrees across the continent, they include a large informal sector, including large subsistence agricultural sectors, tax evasion and avoidance, tax exemptions, and inequitable and opaque rent-sharing arrangements in the extractive sector,” he said.

Meanwhile, Logan Wort, the Executive Secretary ATAF and FIRS Executive Chairman, Tunde Fowler, said yesterday at the Senate hearing on new tax bills that Africa loses about $1 trillion to BEPS and Illicit Financial Flows (IFF) from Africa.

The Minister of Finance, Mrs. Kemi Adeosun, said there remained a strong link between an efficient tax system and economic development.

She underscored the need for strong, robust and effective tax regimes across Africa.