Russia will contend it held back the interventionist tendencies of the US, the US will claim the world is turning its back on a monumental humanitarian crime.
Aside from Syria which dominated, world trade, jobs, recovery, financial stability and tax all featured.
The OECD Action plan is endorsed in its entirety, not really surprising as agreeing every country needs to collect it fair share of tax is a truism no one is going to argue with. The challenge will be how that aspiration is achieved.
The tax language is more measured in the post event statement which is encouraging;
“Cross-border tax evasion and avoidance undermine our public finances and our people’s trust in the fairness of the tax system. Today, we endorsed plans to address these problems and committed to take steps to change our rules to tackle tax avoidance, harmful practices, and aggressive tax planning. “
In jersey we support this aspiration although I fear even this objective may be challenging. Each country is operating under a presumption that it will collect more tax. I think this is questionable.
Changing cross border rules will see winners and losers. There is no reason to assume the tax pie gets bigger, and if it did there would be other damaging consequences.
Taxing sales just moves where the tax is paid, from where the profits are booked, some win, some lose. If the tax burden on companies is raised that means less money for salaries and bonuses which means less income tax, usually a much higher component of national tax take than business taxes. Less money left inside companies means lower investment for which read jobs.
Tax is no panacea for the world’s ill’s, the elephant in the room at the G20 was barely referenced.
The enormous debts taken on by western governments starting in the early 1900s with the promise of universal welfare for everyone are unaffordable in a world where life expectancy has moved from 48 to 80.
Debt is escalating and the escalation is accelerating. Tackling debt and investing for growth ought to be the G20 top priorities, the tax issue is important, but is still in the bigger context, a sideshow.
The G20 representing 90% of global GDP and 65% of the world’s population inspired a hope that great nations could come together to collaborate for the good of human kind.
Increasingly that hope is foundering on the altar of national self interest. Time is running out for this fora if it is to have any credibility; the clock is ticking and the world is watching.
On to Australia.