The Justice and Peace Commission for Southern African Catholics Bishops Conference (SACBC)
has today written an open letter to 21 mining companies operating in South Africa asking each to
explain why it is using tax havens.
New research conducted for the SACBC Justice and Peace Commission shows that these 21
companies, which include some of the largest in the country such as Anglo American, AngloGold
Ashanti, Impala Platinum, LonMin and Petra Diamonds, all have subsidiaries in tax havens, also
known as secrecy jurisdictions: these include the British Virgin Islands, Cayman Islands,
Mauritius, Jersey, the Netherlands and Bermuda. The 21 companies collectively have 117
subsidiaries in such tax havens.
The SACBC Justice and Peace Commission is not accusing these companies of engaging in tax
avoidance. It is the case, however, that the risk that companies generally may engage in tax
avoidance is heightened by their use of tax havens and the inability of outsiders to scrutinise
adequately their tax affairs. The SACBC Justice and Peace Commission is asking these 21
companies what purpose is served by having some subsidiaries in tax havens.
To take two examples:
• The Anglo American group structure includes 43 subsidiaries in tax havens (Bermuda,
British Virgin Islands, Cayman Islands, Isle of Man, Luxembourg, Mauritius and the
Netherlands).i
• Petra Diamonds is itself incorporated in Bermuda and has subsidiaries in the British Virgin
Islands, Bermuda, Jersey and the Netherlands.ii
Of these and other companies, the SACBC Justice and Peace Commission is asking each company
how many employees these subsidiaries employ, what tax advantages the company receives by
having subsidiaries in these tax havens and whether the company is willing to report its key
financial figures on a country-by-country basis in all countries where it operates.
Tax avoidance and tax havens present major problems to governments seeking to maximise the
resources available for public spending. Globally, tax avoidance by multinational companies
amounts to hundreds of billions of dollars; one recent estimate is $500 billion.
