TaxCorporate TaxACCA: Tax policies fuelled financial crisis

ACCA: Tax policies fuelled financial crisis

Tax policies that encouraged the use of debt rather than equity exacerbated the financial crisis, says ACCA

Global tax policies have contributed to the financial crisis by engouraging
the use of debt rather than equity, according to
ACCA.

In its policy paper, the institute said global cooperation was required to
remove “distortions and inconsistencies” between national authorities to help
restore confidence in global financial regulation.
“G20 leaders have proposed improved co-ordination between national authorities
as a key aspect of restoring confidence in global financial regulation. But is
there a need for similar action in the field of taxation? ,” said Chas
Roy-Chowdhury, head of tax at ACCA.
“Our paper examines the most topical international tax issues, from tax havens
to tax competition. Distortions and inconsistencies in tax systems need to be
ironed out. Global co-ordination is vital to make sure that tax is fair and
transparent.”
The paper suggests a number of points, including opening up tax havens but with
governments of major economies avoiding using them to distract from a focus on
their own finances; and address tax issues that distort behaviour.

Further reading:

Go to ACCA’s
policy paper

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