Bono, the rock star and campaigner against Third World debt, is asking the Irish government to contribute more to Africa. At the same time, he’s reducing tax payments that could help fund that aid.
After Ireland said it would scrap a break that lets musicians and artists avoid paying taxes on royalties, Bono and his U2 bandmates earlier this year moved their music publishing company to the Netherlands. The Dublin group, which Forbes estimates earned $110 million in 2005, will pay about 5 percent tax on their royalties, less than half the Irish rate…
Lead guitarist David Evans, known as The Edge, earlier this month defended the publishing company’s move as a sensible decision for a group that makes 90 percent of its money outside Ireland.
“Our business is a very complex business,” Evans said Oct. 2 on Dublin radio station Newstalk, breaking the band’s silence after weeks of public criticism. “Of course we’re trying to be tax-efficient. Who doesn’t want to be tax-efficient?”
Bono, 46, has toured Africa, established the pressure group Debt AIDS Trade Africa and become one of the most vocal supporters of the Make Poverty History campaign. In July 2005, he helped persuade world leaders to double aid for Africa to $50 billion a year by 2010 and erase the debt of the 18 poorest countries on the continent…
At a concert last year in Croke Park, Dublin’s biggest stadium, Bono appealed to Prime Minister Bertie Ahern to raise overseas aid to 0.7 percent of gross national product by 2007 from 0.5 percent now. The crowd responded by booing Ahern.
The political catcalls have now turned on Bono, whose real name is Paul Hewson.
“It seems odd, in a situation where they enjoy an already favorable tax regime, they would move operations to the Netherlands to get an even more favorable rate,” said Joan Burton, finance spokeswoman for the opposition Labour Party…
Wealthy individuals have put about $11.5 trillion in tax havens around the world, according to a 2005 paper by the London- based Tax Justice Network. Unpaid taxes on those assets could amount to $255 billion, the paper said.
“That’s five times the amount needed to achieve the Millennium Development Goals, which Bono says he’s really interested in,” [Richard Murphy, a director at U.K.-based Tax Research Ltd.] said, referring to a United Nations plan to eradicate poverty and combat the spread of AIDS. “My answer is, put your money where your mouth is.”
What is surprising is that the rest of the world continues to take Bono seriously. I would have thought that after the revelation that U2 moved their music publishing company to the Netherlands to cut their tax bill in half, he wouldn’t have dared stepped out of his mansion for fear of being laughed to scorn.
Here was a man who incited audiences to condemn Western politicians for not sending enough of their taxpayers’ money to the wretched of the earth, avoiding tax himself. The Edge, U2’s guitarist, sounded as edgy as a plump accountant in the 19th hole when he explained the move offshore by saying: “Our business is a very complex business. Of course we’re trying to be tax-efficient. Who doesn’t want to be tax-efficient?”
The practical consequences of being “tax-efficient” are many. If you say you care about Africa, why are you paying fees to international money movers who encourage Africa’s “tax-efficient” kleptomaniacs to hide their loot in tax havens? You are also forcing fellow citizens, who didn’t make U2’s estimated $110m in 2005, to pick up the bill, not only for foreign aid, but for education, health, law and order and defence.
And all the time while others suffer on your behalf, you maintain that you are behaving reasonably.