By Ifeanyi Nwoko
In a bid to stop the illicit flow of money from Africa, governments of African countries have been advised to go after firms that enable multinational companies to avoid or evade tax.
The call was made on the sidelines of the 5th Pan African Conference on Illicit Financial Flows (IFFs) from Africa, organised by the Tax Justice Network Africa (TJNA), in Nairobi Kenya.
The conference which identified that Africa was being ripped off of over $50 billion annually in tax avoidance by multinational companies, sought to find ways of recalculating such IFFs and stopping them.
Speaking in an interview with the News Agency of Nigeria (NAN) Dr. Khanyisile Litchfield Tshabalala, Chairperson, Pan African Parliamentary Network on IFFs said, Africa must go after enablers of tax evasion to stop the illicit flows.
With particular reference to the findings of the Panama Papers leak which showed the involvement of accounting and legal firms, Dr. Tshabalala a South African parliamentarian, said that Western Multinationals are only able to rip off Africa because of such firms.
“We have to focus on the enablers of this injustice: Accounting and law firms, they call them the “big five”: KPMG, Deloitte, and others.
“The sad thing is that our accountants and lawyers who are graduating, that is where they see themselves, that is where they want to go and work.
“Those are the people enabling these companies to do tax avoidance and tax evasions. Currently there is no legislation to prosecute those enablers.
“We are dealing with the white monopoly capitalists companies but they are being enabled by people like you and me.
“An African will be assisting because he works with KPMG or Deloitte or PricewaterhouseCoopers (PwC) at the time.
“They will be enabling the robbery of their own resources because that is the company in which they work,” she said.
Dr. Tshabalala said that after the revelations of the Panama Paper in 2016, she had expected African governments especially to go after the big accounting and law firms that facilitated funds transfer by politicians and multinationals to offshore accounts.
She added that the multinational companies are usually taught the loop holes and how to avoid taxes by the firms who consult for them.
“Multinational companies are like me and you; they don’t know how to do this they are taught by the lawyers and the accountants.
“Unfortunately there is no law to prosecute them and that is the message we are starting to relay.
“Although IFFs is a global thing, we know that in Africa we are losing more because it is like their play ground.
“We should lobby for a law that says: Prosecute the enablers: in any court of law, if you steal from me and somebody was assisting you, isn’t it that they find that person guilty too?
“How do we let these enablers go free? I think the press needs to help us with this: they are the enablers and it came out clear in the Panama Papers,” she said.
Speaking on certain identified illicit flow within Africa, she said that the money that illicitly flows from one African country to another were negligible compared to the funds that flows to western countries.
She however stressed that the Pan African Parliamentary Network on IFFs would also look into the matter stressing that IFFs must not be ignored no matter how little it may seem.
“If you have an elephant and a lion in the room, which one is likely to attack you first? It is the lion, so while the elephant is a problem and you don’t want it in your house, but you deal first with the lion.
“The amount of such business ownership in Africa is very negligible compared to the businesses owned by non-African multinationals and white monopolist capitalists.
“Most of the companies that may even claim to be Asian are actually owned by the western countries, those are the people that are ripping us off big time.
“Although we cannot turn a blind eye to it, I will raise it at the parliamentary level and we will discuss it. We can sort ourselves out in Africa.
“But if you open a case against these multinationals, they have the resources to engage in the fights,” she said.