Africa in Talks on Taxing Big Technology Companies

 

Tax officials in Africa estimate governments will collect between 10 and 30 percent less in taxes in 2020 because of the economic downturn.

The coronavirus crisis has caused businesses in the hospitality, building and retail¹ industries to suffer. Yet digital companies have made plenty of money as more people stay home and carry out activities online.

The situation is driving talks on the continent about how to make sure international companies like Google and Facebook can be taxed. Such companies do not always have a physical presence in countries where they earn profits.

Logan Wort is executive secretary of the African Tax Administration Forum², or ATAF. His organization has met online to discuss these issues with government officials, the African Union and members of the Organization for Economic Co-operation and Development, or OECD.

Wort said the coronavirus crisis has led to massive earnings³ for digital services such as e-commerce and online transactions. Profits in e-commerce are expected to increase by 41 percent, the ATAF says.

Wort said, "Question: Are we collecting better on these transactions? Are we aware of these transactions? Are the businesses doing these transactions – do they have a physical presence in our countries? And, if not, do our regulations provide for them to be taxed?"

Talks about how to design tax rights laws for transactions across borders are now happening within the OECD. Governments worldwide are concerned there is a conflict between places where profits are reported and places where economic activities happen.

Victor Harison leads the economic affairs division in the African Union.

Harison has asked more African countries to join in the taxation⁴ talks so profits from international companies can be shared more equitably⁵.

So far, he said, just 25 African countries are involved, "which is a cause [for] concern for the African Union."

David Masondo is deputy minister of finance in South Africa. He said Africa needs a central group within the African Union to speak with one voice on tax policies.

These unified⁶ policies should involve or bring attention to improving the share of tax rights in cross-border transactions. That includes the digital transactions of international companies, Masondo said.

The United States has pressed for its companies to be able to opt⁷ in and out of worldwide laws on taxing such companies – as long as they follow some general rules.

Annet Oguttu is a member of the high-level group on financial accountability and transparency. She noted⁸ that while Europe is in dispute with the U.S. over the issue, African countries should be included in the discussion, too.

She told VOA that much of the discussion seems to be about the U.S. protecting its international companies "and the European countries trying to get the best out of it."

Oguttu said, "Where do we stand as developing countries in Africa?" Coming together under the ATAF might present a more united front to be able to deal with these issues, she added.

International talks are expected to restart in October now that proposals on taxing technology companies have been shared among governments.

I'm Alice Bryant.

Words in This Story

hospitality – n. the activity of providing food, drinks, etc. for people who are the guests or customers of an organization

retail – n. the business of selling things directly to customers for their own use

forum – n. a place or opportunity for discussing a subject

e-commerce – n. activities that relate to the buying and selling of goods and services over the internet

transaction – n. an occurrence in which goods, services or money are passed from one person or account to another

affairs – n. commercial, professional, public, or personal business

opt – v. to choose one thing instead of another

accountability – n. required to explain actions or decisions to someone

transparency – n. the quality that makes something obvious or easy to understand

1 retail   

v./n.零售；adv.以零售价格

参考例句：

• In this shop they retail tobacco and sweets.这家铺子零售香烟和糖果。
• These shoes retail at 10 yuan a pair.这些鞋子零卖10元一双。

2 forum   

n.论坛，讨论会

参考例句：

• They're holding a forum on new ways of teaching history.他们正在举行历史教学讨论会。
• The organisation would provide a forum where problems could be discussed.这个组织将提供一个可以讨论问题的平台。

3 earnings   

n.工资收人；利润，利益，所得

参考例句：

• That old man lives on the earnings of his daughter.那个老人靠他女儿的收入维持生活。
• Last year there was a 20% decrease in his earnings.去年他的收入减少了20%。

4 taxation   

n.征税，税收，税金

参考例句：

• He made a number of simplifications in the taxation system.他在税制上作了一些简化。
• The increase of taxation is an important fiscal policy.增税是一项重要的财政政策。

5 equitably   

公平地

参考例句：

• We should equitably assess historical figures. 我们应该公正地评价历史人物。
• Land was more equitably distributed. 土地得到更公平合理的分配。

6 unified   

(unify 的过去式和过去分词)； 统一的； 统一标准的； 一元化的

参考例句：

• The teacher unified the answer of her pupil with hers. 老师核对了学生的答案。
• The First Emperor of Qin unified China in 221 B.C. 秦始皇于公元前221年统一中国。

7 opt   

vi.选择，决定做某事

参考例句：

• They opt for more holiday instead of more pay.他们选择了延长假期而不是增加工资。
• Will individual schools be given the right to opt out of the local school authority?各个学校可能有权选择退出地方教育局吗？

8 noted   

adj.著名的，知名的

参考例句：

• The local hotel is noted for its good table.当地的那家酒店以餐食精美而著称。
• Jim is noted for arriving late for work.吉姆上班迟到出了名。