In this week’s GLC,Pierre Habbard gives an analysis of the Action Plan on Base Erosion and Profit Shifting (BEPS) which was prepared by the Organisation for Economic Co-operation and Development (OECD). In a meeting held in November 2013 in St Petersburg, BEPS was then endorsed by the G20. Habbard argues that “The international cooperation on tax evasion has been on the G20 agenda since 2009 but tax avoidance is a fairly new topic for the G20. Unlike tax evasion – which is illegal – tax avoidance is in the grey area of compliance.”

Habbard argues that the subject of taxation is an intricate matter that requires vigilance thus trade unions need to be familiar with the taxation laws. “Tax avoidance harms government finance and the right to public services through the net loss in tax revenues. But it also directly affects workers’ rights... for example, illicit transfer pricing typically reduces profit levels in subsidiaries that are employment intensive.” 

Pierre Habbard is a senior policy adviser to the Trade Union Advisory Committee to the OECD (TUAC) and the International Trade Union Confederation (ITUC) covering pension fund regulation, tax, corporate governance, financial regulation and public governance.

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