Tax Treaties: Developing Countries

Lord Collins of Highbury Excerpts

Thursday 25th February 2016 Lords Chamber

[Lord Ashton of Hyde]

Of course, we are trying to increase transparency. As the noble Lord will know, in our presidency of the G8, we led on international anti-tax evasion measures and we continue to work with the OECD. We were the first to sign the agreement for international exchange of information. As far as the anti-corruption summit is concerned, that is certainly something we will do. One of the problems, however, is that just increasing taxes in developing countries is not a silver bullet because of corruption: the tax that is raised has to go to the right places.

[Lord Collins of Highbury (Lab)]

My Lords, if there is one area that requires joined-up government, it is this. Of course, the Department for International Development, with its 0.7% budget, should be involved in these discussions because, as in the case of Malawi, you could be taking away with one hand and putting in with the other. Has DfID been involved in all these negotiations and will they be linked to the delivery of the sustainable development goals? Never mind the Rhodes statue—surely it is time that the Malawi agreement came falling down.

[Lord Ashton of Hyde]

DfID is involved in the consultations that the Treasury has every year on which countries should be involved and on new taxation agreements to be brought forward. It holds discussions on which goals should be taken forward, but the department is not involved in the individual negotiation of tax treaties, which is for the experts on taxation in the Treasury. It also helps to pay for tax education in developing countries, and the Government have doubled the amount that they are prepared to spend on this through DfID. We think development aid should be controlled and administered through DfID, subject to proper governance arrangements in keeping with our development strategy.