April 7th, 2016
Episode 689 of 899 episodes
Panama will set up a special Commission to consider the fallout of the leak of millions of documents from the law firm Mossack Fonseca. It could mean more banking transparency. We get analysis from US journalist Ken Silverstein, who started writing about the activities of Mossack Fonseca 18 ago. Evidence from the Panama Papers data leak suggests an oil company, that used to have its shares listed in London, Heritage Oil, was advised to use tax havens to avoid paying $400 million in Capital Gains Tax to the Ugandan government. We hear from BBC reporter Rob Wilson, who has been following the story. Tax havens are under scrutiny, notably because of the perception they can be used by corrupt politicians to steal money, to hide the real owners of companies and to drive up property prices in cities where ordinary people struggle to afford a home. However our regular economic commentator, Irwin Stelzer says the real issue is not that leaders avoided tax, but how they got the money they are shielding. VAT or Value Added Tax is one of the biggest sources of Government revenue in the European Union, but it could be a lot bigger, according to the latest official figures. If fraud and inefficiencies could be eliminated, governments would have almost $200 billion to spend on public services. Now the European Commission is proposing a shake-up of the system to track down the missing money. One of the biggest offenders is Romania, where 40% of the VAT which should be raised is disappearing. Sorin Biban a Tax Manager at Biris Goran Consulting in Bucharest explains what is going on, while Professor Rita de la Feria, Chair in Tax Law at the University of Leeds, tells us how important the missing VAT is. About 200 owners of start-up businesses from around the world are meeting in the Ugandan capital, Kampala, for the Young Entrepreneur Awards. The initiative is part of the Prince's Trust, headed by Britain's Prince Charles. We hear from two of the aspiring entrepreneurs, one from Sweden and the other from Uganda.