Oxfam, an organization whose goal is to reduce poverty and inequality and significantly advance rights of women says when the public financial and procurement systems are dysfunctional, high net worth individuals and corporates take advantage of the porous taxation system to deprive government tax, public resources are lost and it is the poor who pay the price.
The statement made available to the media through the office of the Oxfam Country Director states that paradise paper like the
Panama paper have exposed yet another iniquities of tax haven.
The statement says Zambia like many other African countries has not been spared the injustice of tax dodging.
“A media sweep through on broader issues of transparency and accountability in Zambia shows that mismanagement and corruption are hardwired in the country’s procurement systems. Zambian citizens have heard with frustrations a litany of complaints about tax avoidance by high net worth individuals and corporates. This is in addition to the annual Auditor General revelation of a wasteful and inefficient public service,” reads the statement in part.
It said the malpractices are compounded on lack of accountability on how the country’s meagre public resources are used.
“The case in point is the procurement of fire tenders, ambulances and the construction of the Ndola-Lusaka dual carriageway way,” the statement said
It expressed regret that citizens are also frustrated by the fact that recurrent of scandals fizzle out with little repercussion from the perpetrators.
“Seldom has there been legal consequences for these corporations and politically exposed individuals within and outside government who are responsible for mismanagement of the country’s resources,” it said.
The statement said the inequalities and implications of such a rogue system are widespread and immense.
“These abuses are both are roots of sustainable inequality and an important obstacle to poverty reduction.
” For instance, a staggering 30% of rich African wealth, a total of US$ 500 bn is held offshore in tax haven. These rich Africans are using the global network of tax haven to hide about $14bn, a year in taxes. At the same time corporation have been estimated to prejudice Zambia $38 bn in lost tax revenues,” the statement read.
“These figures when taken together lost illicitly, dwarf the annual aide flow to Africa. Such revenues losses compound the problem of mounting and unsustainable debt, tightened spending on health, education,” the statement said.