Importantly, unions will be able to use these public Country-by-Country reports to see where a multinational’s profits are stashed: a key tool in negotiating wage increases. This will help ensure workers as well as the tax office can share in the wealth we all create. The Standard will also be useful in negotiating GFA’s and for increased transparency in government procurement clauses.

The Global Reporting Initiative - an independent organization that creates reporting standards for businesses and governments - developed the new Tax Standard in consultation with civil society, unions, governments and the private sector.

Trade unions around the world played a key role in shaping the standard - PSI represented the global labour movement on the GRI’s Tax Technical Committee which developed the standard and worked with the Center for International Corporate Tax Accountability and Research (CICTAR) to mobilise investment funds worth over $10 trillion USD to formally support the proposal, generating significant media coverage.

Daniel Bertossa, Assistant General Secretary of Public Services International, the global trade union federation, said:

Currently, 63% of the largest 100 global companies and 75% of the Global Fortune 250 are GRI compliant. This means, if they wish to continue being GRI compliant they will need to publish Country-by-Country tax reports annually. Unlike other voluntary standards, the GRI standard is rigorous and much better than the current OECD (non-public) standard. This will place significant pressure on the OECD ahead of its own standard’s review in 2020.

The Standard’s release comes as politicians around the world, responding to widespread public outrage, are increasing efforts to crack down on corporate tax avoidance. In the UK, the Labour Party has committed to implementing Unitary Taxation - which would ensure multinational conglomerates are taxed as single firms rather than an artificial maze of subsidiaries.

Once implemented, the new GRI Standard will help both tax authorities and the public have a much clearer picture of how much - or how little - a corporation is paying in tax in each country they operate.

Jason Ward, from CICTAR, said

There is growing anger around the world at governments’ inability to deal with issues like tax dodging, which is eroding trust in public institutions. In Malta, the Prime Minister was recently forced to resign after questions were raised over his links to the murder of a journalist who was working on the Panama Papers investigation.

“Every time the public gets a glimpse at the scale of tax dodging - from the Panama Papers to the Lux Leaks - the calls for real change grow louder. We must use this new Standard as the basis for building the popular political case for meaningful international corporate tax reform - to stop the rip-off and fund the public services we need,” says Bertossa.

Multinational corporations must be more accountable so that governments can develop tax policies that address inequalities, as well as the populism and authoritarianism that stem from them. This is also necessary for growth since political instability deters companies from investing. The new GRI standard represents a key step towards corporate tax transparency and, once implemented, will help restore confidence in our democratic institutions.

“Tax avoidance comes with high human costs as it undermines governments’ ability to provide quality public services and promote economic development. We cannot tackle pressing global issues like poverty reduction, climate change and implementation of Sustainable Development Goals without a fair and adequate tax system,” says Bertossa.