ActionAid Slams Barclays for Corporation Tax Avoidance Promotion in Africa

ActionAid has slammed Barclays for claiming to be a "force of good" despite promoting the use of offshore tax havens to big companies operating in Africa.

According to a report by the charity, titled Time to Clean Up: How Barclays Bank promotes the use of tax havens in Africa, Barclays is using its Offshore Corporate department to market a range of tax havens for big businesses to avoid tax in Africa, leading to poor countries losing even more in tax revenues.

"Every year developing countries lose billions of pounds of vitally needed revenue because of tax avoidance by big companies using tax havens," said Toby Quantrill, Tax Justice Adviser for ActionAid.

"When companies avoid tax, they drain billions of pounds of revenues out of developing countries that could be used to help build schools and hospitals and lift people out of poverty.

"Now Barclays customers have sent a stark message to their bank. A clear majority are saying it is unacceptable for their bank to be providing the kind of services that can help businesses reduce their tax payments."

According to a poll, commissioned by ActionAid, 57% of Barclays' customers say it is unacceptable for the bank to provide services that can help large companies reduce their tax bills in developing countries.

Only 21% of customers say that it is acceptable.

ActionAid's report shows that in September Barclays Offshore Corporate increased the number of tax havens it was promoting, to include the key African tax haven of Mauritius.

"Mauritius has a very low effective tax rate and its network of tax treaties with other African countries means that large companies can use it as a key location to avoid tax," said Action Aid.

"ActionAid is now demanding that Barclays honours its commitment to change and specifically to close down its Offshore Corporate department, which it uses to promote tax havens to big businesses in Africa."

According to the World Economic Forum (Wef), the island nation of Mauritius has claimed Africa's top spot in the annual Global Competitiveness Report for 2013-14.

According to the Organisation for Economic Co-operation and Development, tax havens cost developing countries just under three times more than they receive in aid every year.

"Tax revenue is vital to helping boost investment in basic services in some of the poorest parts of the world. But for as long as major companies like Barclays promote tax havens, then there will always be businesses who avoid tax. We are asking Barclays to do better than that. We want them to show that when they say they are 'changing' - they actually mean it," said Quantrill.