CSR, tax and development

Third World Quarterly

Volumn 34, Issue 3, 2013, Pages 378-396

  Jenkins, Rhys ^a   Newell, Peter ^b  

^a UNIVERSITY OF EAST ANGLIA   (United Kingdom)

^b UNIVERSITY OF SUSSEX   (United Kingdom)

Author keywords

[No Author keywords available]

Indexed keywords

EMPIRICAL ANALYSIS; ETHICS; POVERTY ALLEVIATION; TAX SYSTEM;

EID: 84878539505     PISSN: 01436597     EISSN: 13602241     Source Type: Journal    
DOI: 10.1080/01436597.2013.784596     Document Type: Review

References (125)

1. We would like to express our gratitude to the reviewers and editor at Third World Quarterly, to Matt Cape for research assistance on this project and to the ESRC for support for a workshop on this theme as part of the series 'Corporate responsibility and human development' (RES-451-26-0548).
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39. Palan, 'Tax havens and the commercialisation of sovereignty'.
40. It is ironic that at the same time that companies have increasingly emphasised their social responsibility through the adoption of codes of conduct and the publication of csr reports, there has also been a growing reliance on complex strategies to limit corporate tax liabilities.Note.
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59. For a more detailed breakdown of the different ways in which companies reduce their tax bills, see Tax Justice Network, Closing the Floodgates: Collecting Tax to Pay for Development, Report prepared for the Norwegian Ministry of Foreign Affairs, 2007, ch 4.
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63. Eden, 'Transfer price manipulation'.
64. In 2006 Glaxo Smith Kline agreed to pay $3.1 billion to the US tax authorities in order to settle a long-running transfer pricing dispute. For other examples.
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70. A Hollingshead, The Implied Tax Revenue Loss from Trade Mispricing, Washington, DC: Global Financial Integrity, 2010.
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75. Action Aid, Sweet Nothings; The Human Cost of a British Sugar Giant Avoiding Taxes in Southern Africa, London: Action Ad, 2013.
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78. Benari, 'Tricky tax'.
79. 'Going Dutch', The Guardian, 2 February 2009, pp 16-17.
80. Tax Justice Network, Closing the Floodgates.
81. This is sometimes referred to as 'earnings stripping'. Gravelle, Tax Havens.
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83. Action Aid, Calling Time.
84. Starbuck's declared losses in the UK on sales of £1.2 billion over the past three years. It was claimed that the UK operation was able to avoid declaring profits in the UK through paying a 6% royalty fee to its European hq in Amsterdam for use of its 'intellectual property', payments for imported coffee beans from a Starbuck's Coffee Trading Co in Switzerland, and through high interest payments (at libor + 4%) on intra-company loans.
85. T Bergen, Special Report: How Starbucks avoids UK Taxes, Reuters, 2012.
86. C Azémar, International Corporate Taxation and US Multinationals' Behaviour: An Integrated Approach, University of Glasgow, Department of Economics Discussion Paper, August 2008 finds evidence that countries with a low quality of law enforcement tend to have more difficulty in implementing anti-tax avoidance measures such as 'thin capitalisation' rules or arm's length pricing.
87. C Fuest & N Rie-del, 'Tax Evasion and Tax Avoidance: The Role of International Profit Shifting' in P. Reuter (ed.), Draining Development? Controlling Flows of Illicit Funds from Developing Countries, Washington DC: World Bank, 2012, p 121.
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90. M Desai & D Dharmapala, 'Csr and taxation: the missing link', 2006, at http:// www.people.hbs.edu/mdesai/D+DBSR.pdf;
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92. A Muller & A Kolk, 'Reponsible tax as corporate social responsibility: the case of multinational enterprises and effective tax in India, Business and Society, forthcoming.
93. Indeed, connections between corporate strategies in these parallel areas have been made. One newspaper commented: 'The practice of only paying tax in the lowest charging country in which companies operate is mirrored in other aspects of their operations such as labour rights and environmental law where they will move around to operate in the least regulated domain in order to maximise profits'. Morning Star, 13 December 2012, p 12.
94. http://www.uniceforg.uk/enough-food-for-everyone-if/enough-food-for-everyone-if-the-issues/, accessed 13 February 2013.
95. The Guardian ran a series of articles on 'The tax gap' in February 2009.
96. 'The great tax heist', Daily Mail, 17 December 2010.
97. There is ongoing discussion, for example, about a code of conduct on international tax cooperation governing the sharing of information between tax authorities.
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99. 'Davos 2013: David Cameron calls measures to tackle tax avoidance', Daily Telegraph, 24 January 2013, at http://www.telegraph.co.uk/finance/financetopics/davos/9823032/Davos-2013-David-Cameron-calls-mea-sures-to-tackle-tax-avoidance.html, accessed 13 February 2013.
100. For an interesting discussion of the implications of different views of the corporation for csr and strategic tax behaviour.
101. Avi-Yonah, Corporate Social Responsibility and Strategic Tax Behaviour.
102. 'csr', The Guardian, 14 February 2009, p 41.
103. Barclays has recently announced the closure of its Structured Capital Markets unit, which was reported to have contributed £1 billion a year to the bank's profits through its tax avoidance schemes.
104. F Lawrence, 'Barclays secret tax avoidance factory that made £1 billion profit a year disbanded', The Guardian, 11 February 2013, at http://www.guardian.co.uk/business/ 2013/feb/11/barclays-investment-banking-tax-avoidance, accessed 13 February 2013.
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107. J Elkington, 'The triple bottom line for twenty-first century business', in J Mitchell (ed), Companies in a World of Conflict, London: riia, 1998, pp 32-61.
108. Sustainability, Taxing Issues: Responsible Business and Tax, London: Sustainability, 2006.
109. D Williams, Tax and Corporate Social Responsibility, kpmg Tax Business School Discussion Paper, 2007.
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111. R Hardyment, P Truesdale & M Tuffrey, Tax as a Corporate Responsibility Issue: The Implications for Multinationals, London: Corporate Citizenship, 2011.
112. Other companies whose tax avoidance strategies were put under the spotlight in a series of articles in The Guardian on the 'Tax gap' in 2009 included the pharmaceutical companies GlaxoSmithKline, AstraZeneca and Shire, PepsiCo (with Walkers Crisps), Vodafone, Lloyds TSB, Barclays and the WPp advertising group.
113. Sikka, 'Smoke and mirrors'.
114. For example, Sustainability produced a report Taxing Issues: Responsible Business and Tax in 2006 (see note 80). The Tax Justice Network has also argued strongly that corporate responsibility should include tax issues. Tax Justice Network, Tax Us if You can, ch 5.1.
115. oecd, Codes of Corporate Conduct-An Expanded Review of their Contents, Paris: oecd Working Party of the Trade Committee, TD/TC/WP(99)56/FINAL, 2000, p 16.
116. M Kaptein, 'Business codes of multinational firms: what do they say?', Journal of Business Ethics, 50, 2004, Table V
117. L Preuss, 'Tax avoidance and corporate social responsibility: you can't do both, or can you?', Corporate Governance, 10(4), 2010, p 371.
118. It is ironic that the first two of these companies featured in The Guardian's 'Tax gap' series of articles.
119. Diageo, Corporate Citizenship Report, 2008, p 28.
120. wpp, Corporate Responsibility Report, 2008-2009.
121. Vodafone Group, Tax Code of Conduct.
122. Interestingly the last part of this statement, referring to minimising tax liabilities, has been dropped in the most recent version of the Unilever code. See www.unilever.com/sustsinability/economic/tax
123. http://www.unilever.com/sustainable-living/betterlivelihoods/tax/, accessed 13 January 2013.
124. LJ Weber, 'Citizenship and democracy: the ethics of corporate lobbying', Business Ethics Quarterly, 6(2), 1996, pp 253-259.
125. Newell, 'Managing multinationals'.