The contribution of corporate tax to the sustainable development goals in Sub-Saharan Africa : a case study of Vodafone

Abstract

BACKGROUND : We are not on track to reach many of the Sustainable Development Goal (SDG) targets for 2030. The under-5 mortality and maternal mortality rates are well below the target, and if progress continues in the same way it has in recent years, we will not meet our goal by 2030. The decline in child and maternal mortality since 1990 has mainly resulted from increased coverage of sanitation, drinking water, education, and health services. When governments have more income, they spend more on public services, which increases access to fundamental economic and social rights and, thus, contributes towards the SDGs. Taxation constitutes 70% of government revenue in low-income countries, and corporate income tax contributes much more than high-income countries. Therefore, corporate taxation plays a vital role in SDG progress.

This paper aims to demonstrate the contribution of one large taxpayer that publishes their tax payments (Vodafone Group Plc) on the progress towards SDGs 3, 4, and 6 in six African countries.

We use econometric modelling to estimate the impact of an increase in government revenue equivalent to Vodafone's average tax paid between 2007-2017.

RESULTS : We find it results in almost 400,000 people accessing clean water, nearly 700,000 accessing basic sanitation, 15,175 children spending an extra year in school. As a result, over ten years, an additional 9,165 children under five years and 1,325 mothers would survive.

CONCLUSIONS : These findings demonstrate that the contributions from a single multinational corporation can drive progress towards the SDGs. Furthermore, it highlights the importance of paying fair tax and explores the responsibilities of global institutions, governments, investors, and multinational corporations.