Every year well over US$1 TRILLION goes missing through mismanagement, illicit business practices and poor governance. This money doesn’t just evaporate - it is actually deducted from the livelihood of some of the poorest people in the world.
About 3.5 billion people live in countries rich in oil, gas and minerals. Revenue from these sectors is often one of the greatest sources of wealth generated within developing countries, but such wealth often provides little benefit to the people living in these countries, especially those living in poverty. This is due to losses from tax dodging by the companies involved or corruption by the governments of the countries in question.
Currently many mining, oil and gas companies only report their finances on a global or regional basis, making it impossible for local communities to know how much tax and royalties have been paid to their governments, and therefore impossible for them to hold either the companies or their government to account.
The G20, of which Australia is a member, has encouraged disclosures by the mining, oil and gas industries of payments made to governments. Further, the US government has introduced laws which require companies in the oil, gas and mining sector listed on the US Securities and Exchange Commission to have to report on taxes and royalties paid to governments on a country-by-country and project-by-project basis. The Australian government is yet to support such action.
Country by country reporting requirements are a vital step towards reducing tax evasion and other forms of corruption by shining a light into areas where there is currently a veil of secrecy. This makes it harder for companies to shift their revenues to tax havens unseen. It also increases the ability of citizens of developing countries to hold their own governments to account for the tax revenue they receive from natural resources.
Visit the Micah Challenge website to sign a petition urging the Australian government to support the call for greater transparency in reporting by mining, oil and gas companies.