Improving tax collection raises needed resources for countries, noted Treasury Secretary Yellen at a virtual G7 finance ministers meeting. Yellen praised a July G20 agreement to curb corporate tax avoidance. The agreement is supported by 134 countries.
“We are seeing significant progress on curbing global corporate tax avoidance,” said Eric LeCompte, Executive Director of the religious development organization Jubilee USA Network. “As new tax agreements move forward, developing countries must be included. Too many countries lack the resources to combat the pandemic because they aren't collecting adequate tax revenue."
Yellen encouraged her G7 counterparts to lend their shares of a recent emergency currency creation of $650 billion for global pandemic response. In August, the International Monetary Fund authorized the emergency response funds known as Special Drawing Rights. G7 countries received more than $280 billion and developing countries received around $230 billion of the emergency currency. Wealthy countries can donate or lend their Special Drawing Rights to developing countries.
“Rich countries don't need their share of emergency pandemic response funds," noted LeCompte who serves on United Nations finance expert groups. “Given the level of suffering in developing countries, wealthy countries should donate their funds instead of lending them to poor countries."
Read Treasury's readout of the G7 meeting here.
Read about the historic $650 billion SDR allocation here.
See Jubilee USA's calculation of the approximate amount each country receives in emergency SDRs currency here.