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Time for UK to back demands for multinationals to come clean on tax

September 19 2012 - New laws to force multinational corporations to reveal more about their financial affairs have come a step closer after a vote yesterday in the European Parliament.

MEPs on the Parliament’s Legal Affairs (JURI) Committee have backed plans for strong new rules requiring oil, gas and mining companies to report their payments to governments in countries where they work. If implemented, the plans will make both companies and governments more accountable for their actions.

Joseph Stead, Christian Aid’s Senior Adviser on Economic Justice, said: ‘MEPs’ vote is a very welcome step towards a future in which multinationals have to reveal far more about their finances.

‘That, in turn, will make it much harder for them to dodge tax – a menace which currently costs developing countries some $160 billion a year, with devastating effects on public services and the people who use them.

‘Now it’s vital that the UK Government gets involved, to push the European Council of Ministers into agreeing to these important reforms, which could benefit millions of people around the world.

‘David Cameron and George Osborne have both said they support greater corporate transparency – now they have a chance to prove it and deliver good rules as well as talk a good game.’

Christian Aid is campaigning for the introduction of country-by-country reporting for multinationals – an accounting standard which would force firms to reveal more than required by the plans voted on by MEPs yesterday.

However, it regards the European Parliament plans as a major improvement on existing corporate secrecy. The plans include a welcome review clause that makes clear the need for Europe to consider requiring further disclosures in a few years’ time.

The rules which MEPs voted on yesterday go further than their US equivalents in some respects - notably by extending transparency requirements to banking, construction and telecoms companies and by requiring companies to declare the number of people they employ in every country where they operate.

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For more information, please contact Rachel Baird on 0207 523 2446 or rbaird@christian-aid.org

Notes to Editors:

1. Christian Aid works in some of the world's poorest communities in 47 countries. We act where there is great need, regardless of religion, helping people build the lives they deserve.

2. Christian Aid has a vision, an end to global poverty, and we believe that vision can become a reality. Our report, Poverty Over, explains what we believe needs to be done – and can be done – to end poverty.  Details at http://www.christianaid.org.uk/Images/poverty-over-report.pdf

3. Christian Aid is a member of the ACT Alliance, a global coalition of 100 churches and church-related organisations that work together inhumanitarian assistance and development.  Further details at http://www.actalliance.org

4. Follow Christian Aid's newswire on Twitter: http://twitter.com/caid_newswire

5. For more information about the work of Christian Aid visit www.christianaid.org.uk