Here’s the summary of the recent Global Responsible Tax webcast, hosted on Monday 7 December 2020. Featuring tax leaders from KPMG International and expert representatives from the OECD, IMF, Oxfam, Vodafone, BlackRock and the International Finance Corporation (among others), it was a great conversation.
The webcast looked at what the new reality may look like for Responsible Tax; the challenges of funding recovery; and the opportunities to Build Back Better in response to the current environment.
David Linke (Global Head of Tax & Legal Services, KPMG International) and Chris Morgan (Global Head of Tax Policy, KPMG International) kicked things off with a recap of the findings from our recent summer roundtable series and the five key dilemmas identified – you can read the Summary Report here.
The IMF’s Ruud de Mooij followed with a keynote presentation taking stock of where we are and the importance of the three T’s in post-COVID recovery – stimulus measures should be Timely, Targeted, and Temporary – and an analysis of the inevitable questions this raises.
The first panel discussion moderated by Melissa Geiger (Partner, Head of International Tax and Tax Policy, KPMG in the UK) saw David Bradbury (Head of the Tax Policy and Statistics Division, OECD); Susana Ruiz Rodríguez (Regional Taxation Coordinator, Oxfam); and John Connors (Group Tax Director, Vodafone) discuss finding the right balance in stimulating recovery.
The second panel moderated by Grant Wardell-Johnson (Head of Australian Tax Centre, KPMG in Australia) included a conversation on how to Build Back Better with Mike Hayes (Global Head of Renewables, KPMG International); Jessie Coleman (Tax Office Lead, International Finance Corporation (World Bank Group)); and Tom Hylton (Director, BlackRock).
If you missed it, you can watch the discussion on replay here.
“This year has brought a question into sharp focus: How do you design tax policy that is resilient to future shocks? Tax policy that will not just protect but prepare for what
might eventuate next?”
David Linke, Global Head of Tax & Legal Services, KPMG International
Below you can read some of the key quotes from the session…
On finding the right balance in stimulating recovery
“The cost of unwinding support too quickly can be very large and long-lasting” – Ruud de Mooij, IMF
“It is not necessarily mutually exclusive to choose between stimulating the economy and raising tax revenues but there are certainly a lot of tough decisions ahead for us” – Melissa Geiger, KPMG in the UK
“It’s inevitable we will see some tax rises and if they’re proportionate and focus on income, revenues and the consequent profits then it gives some room for growth… They can be borne by businesses that continue to be successful and continue to thrive throughout and beyond the crisis” – John Connors, Vodafone
There is reasonable degree of consensus that now is not the time [to raise taxes]…Now is the time to be reflecting on what we need to do the fiscal repair job once we do get through this crisis” – David Bradbury, OECD
On the elevation of the green agenda in the board room
“Decarbonisation and the identification of climate risk have actually accelerated in the boardroom during the period of COVID-19 which is fascinating but not a surprise… there has been a growing realisation that it’s big, it’s happening and if we don’t take action today we will have a much bigger global catastrophe on our hands” – Mike Hayes, KPMG International
“Climate change may not hit us as quickly as this pandemic has but the inevitability of the impacts of it are just as significant and action will need to be taken” – David Bradbury, OECD
“Sometimes people think that if you move away from labour taxes towards green taxes you kill two birds with one stone because you reduce the tax on labour which is good for employment and you have a higher tax on pollution which is good for the environment…But we should be cautious to have too higher expectations because these taxes on pollution also have implications for the labour market” – Ruud de Mooij, IMF
Private capital can be a big player and a big part in helping drive that [green] recovery…we see a lot of interest in sustainability and renewable power” – Tom Hylton, Blackrock
On Building Back Better – resilient, inclusive & green
“Having experienced this pandemic, it is going to be important that we invest in making our economies and our societies resilient for future shocks whether they be pandemics or other shocks…This is where the green recovery and climate change issues comes into play as well” – David Bradbury, OECD
“There’s a role for the public and the private side to drive what needs to be done and to promote investment – we’re seeing this at an unprecedented level” – Jessie Coleman, IFC
“The pandemic has magnified an already rising trend of large inequality in many countries…the pandemic disproportionately affected the poor which has brought progressive taxes even more to the fore of the tax agenda” – Ruud de Mooij, IMF
“If we’re talking about timely response, it has to be now – because we need to give the right sign to society that this crisis is not going to be paid by those who have been harmed most – the most vulnerable in society” – Susanna Ruiz Rodriguez, Oxfam
It is really important for governments to introduce appropriately targeted incentives be it for R&D, tech and innovation or environmental issues. Above-the-line tax credits, reliefs and incentives for green initiatives or innovation will drive the right behaviours and businesses will build back the economy more robustly for the future” – John Connors, Vodafone
“If we think about new infrastructure, new technologies, new solutions – we will never get an opportunity like this again in our lifetime to actually correct the carbon imbalance” – Mike Hayes, KPMG International
If you would like to (re-)watch the webcast in
full you can do so here.
The report below summarises the key themes and focus areas that emerged over the course of the Summer 2020 Global Responsible Tax roundtable series including whether the COVID-19 crisis provides an opportunity for deep structural reform; questions of how to meet future revenue needs for increased health and social expenditure and the reduction of government debt arising from the pandemic situation.
As we head towards a new year the Global Responsible Tax community will continue to convene around the recovery, how? conversation – looking in particular at issues of transparency and green investment.
Do get in touch if you have thoughts or ideas to share or
would like to find out more.