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AltAusterity Digest #101 June 6-12, 2019

This week in Austerity News:

Jun 14, 2019

Teresa May is stepping down as the leader of the UK Tories, resulting in a race for the Conservative party leadership. Conservative candidate Boris Johnson has stated that as part of his platform, he would cut income tax bills for people earning more than £50,000 a year (approximately 84,600 CAD), with an estimated cost of £9.6bn a year. A researcher from the Institute for Fiscal Studies think tank has pointed out that the greatest beneficiaries of Johnson’s current proposal would be wealthy pensioners and people living solely off investments. Johnson’s proposal has been roundly critiqued by both Labour MPs and other Conservative MP contenders.

To meet the conditions of an IMF loan agreement, Pakistan has rolled out an ambitious austerity budget. The budget aims to generate a 30% increase in tax revenues compared to last year by increasing tax collections. In Pakistan, only 2-million out of 210-million people file income tax returns. Last month Prime Minister Imran Khan, who ran on a platform of building an Islamic welfare state, agreed to a $6-billion IMF loan in return of implementing a series of austerity measures. The budget comes at a time when households are already being squeezed by increased consumption and utility taxes and inflation is above 7%.

The last series of cuts from the Ontario Conservative party will place severe limitations on people seeking legal aid to help fight environmental issues and the ongoing climate emergency. The Canadian Environmental Law Association (CELA) offers legal support to low-income communities and clients who have been harmed by pollution or climate related issues. CELA is one of six specialty legal aid clinics that form a part of Legal Aid Ontario (LAO). The LAO has had its budget slashed by 30% ($133 million) despite their 2019 budget already being finalized.

The OECD has reported that efforts to improve tax compliance through international information exchange on financial accounts have thus far been largely successful. To date, the OECD Common Reporting Standard (CRS) has exchanged information on 47 million offshore accounts containing €4.9 trillion in an attempt to counter tax evasion. The OECD Automatic Exchange of Information (AEOI) initiative has been used to strengthen tax compliance across borders. While it is still difficult for many governments to tax these offshore havens, the figure is slowly rising year over year. The total value of additional revenues going to governments in the 2009-2019 period has been €95 billion

That's it for this week's Digest! Check back next Friday morning for another edition, or subscribe to our newsletter for a weekly roundup. We'll also Tweet each time we add new content, so you can keep up with our work @AltAusterity and join the #altausterity conversation.