More developing countries are set to become involved in reforming the global tax system in an effort to ensure that multinational corporations are taxed where their real economic activities take place. This is according to a new roadmap presented by the Organization for Economic Co-operation and Development (OECD) to ‘upgrade’ the involvement of ten developing countries regarding the international tax process known as Base Erosion and Profit Shifting (BEPS) and for them to take part in a second round of regional consultations, similar to the talks in March 2014.
The OECD announcement comes just days before the G20 Summit in Brisbane, Australia. The invitation to specific developing countries is for them to participate in technical tax discussions in the OECD Committee of Fiscal Affairs.
Susana Ruiz Rodrigues, an Oxfam tax expert, said:
“We welcome this step taken by the OECD Secretariat, as it acknowledges the limitations of the initial reform that did not equally involve all countries. The significance of this is that developing countries are deprived of US$100 billion every year due to corporate tax abuses.
“While Oxfam acknowledges this positive move, and the funding to ensure developing countries’ participation and capacity building, it is regrettable that this decision has been made half-way through the negotiation process.
“Uncertainties remain on how the 10 developing countries will have enough capacity to influence the OECD technical tax discussions and whether they really will be able to have their priorities listened to.
“The unequal say developed countries have on international tax reform remains, despite the OECD’s efforts today. The Secretariat has pushed as far as it can, while operating well, given its mandate.
“It’s important to remember that many issues that significantly affect developing countries, such as tax competition and source-versus-residence taxation, are locked out of the OECD-led process.
“The current reform simply shows how badly we need a new global institutional framework to agree on international tax reforms where all countries are equally represented and the scope of negotiations can be broadened so that all countries benefit.”
Notes aux rédactions
- G20 leaders are due to meet in Brisbane, Australia, on 15 and 16 November 2014 to strengthen international economic cooperation and decision-making. As part of the Australian Presidency agenda to build global economic resilience, improving the international tax system to fight tax avoidance by big multinationals is a high priority. At the G20 Summit in 2013, G20 leaders endorsed the OECD action plan on BEPS to put an end to practices used by large companies to avoid taxation and ensure “profits should be taxed where economic activities deriving the profits are performed and where value is created.”
- On 16 September, the OECD presented 7 deliverables out of the 15 recommendations contained in its BEPS action plan, related namely to tax treaties, tax transparency, harmful tax practices or taxation of the digital economy.
- The OECD says it has consulted over 80 developing countries through four regional consultations and five thematic global fora. The OECD worked with regional tax administration bodies like ATAF (Africa) or CIAT (Latin America) to organize consultations in Asia, Latin America and Africa around March 2013 and a fourth round in Paris for African francophone countries. However, many representatives from developing countries either could not participate in the meetings or expressed concerned that they did not have access to enough information to meaningfully contribute to negotiations.
- On 11 November, Oxfam published a press release calling on the G20 to act on rising inequality, starting with a fairer global tax reform. Our research shows that developing countries could be losing more than US$100 billion every year because of corporate tax dodging and tax breaks for corporations. This would be almost enough to get every child into school four times over.
- Oxfam will have a team of policy experts at the Brisbane summit, available for interview, comment and analysis in English, Spanish, French and Turkish.
- Oxfam International Executive Director, Winnie Byanyima, will be available for interview in Brisbane.
Contact
- In Australia, please contact Laurelle Keogh on +61 425 701 801 or laurellek@oxfam.org.au
- In Australia, for interviews with Winnie Byanyima, please contact Caroline Hooper-Box on +1 202 321 2967 / +61 400 540 704 or caroline.hooper-box@oxfaminternational.org, or @hooper_box
- In the UK, please contact Dannielle Taaffe on +44 7917 110 066 or dannielle.taaffe@oxfaminternational.org
For updates, please follow @Oxfam.
- G20 leaders are due to meet in Brisbane, Australia, on 15 and 16 November 2014 to strengthen international economic cooperation and decision-making. As part of the Australian Presidency agenda to build global economic resilience, improving the international tax system to fight tax avoidance by big multinationals is a high priority. At the G20 Summit in 2013, G20 leaders endorsed the OECD action plan on BEPS to put an end to practices used by large companies to avoid taxation and ensure “profits should be taxed where economic activities deriving the profits are performed and where value is created.”
- On 16 September, the OECD presented 7 deliverables out of the 15 recommendations contained in its BEPS action plan, related namely to tax treaties, tax transparency, harmful tax practices or taxation of the digital economy.
- The OECD says it has consulted over 80 developing countries through four regional consultations and five thematic global fora. The OECD worked with regional tax administration bodies like ATAF (Africa) or CIAT (Latin America) to organize consultations in Asia, Latin America and Africa around March 2013 and a fourth round in Paris for African francophone countries. However, many representatives from developing countries either could not participate in the meetings or expressed concerned that they did not have access to enough information to meaningfully contribute to negotiations.
- On 11 November, Oxfam published a press release calling on the G20 to act on rising inequality, starting with a fairer global tax reform. Our research shows that developing countries could be losing more than US$100 billion every year because of corporate tax dodging and tax breaks for corporations. This would be almost enough to get every child into school four times over.
- Oxfam will have a team of policy experts at the Brisbane summit, available for interview, comment and analysis in English, Spanish, French and Turkish.
- Oxfam International Executive Director, Winnie Byanyima, will be available for interview in Brisbane.
- In Australia, please contact Laurelle Keogh on +61 425 701 801 or laurellek@oxfam.org.au
- In Australia, for interviews with Winnie Byanyima, please contact Caroline Hooper-Box on +1 202 321 2967 / +61 400 540 704 or caroline.hooper-box@oxfaminternational.org, or @hooper_box
- In the UK, please contact Dannielle Taaffe on +44 7917 110 066 or dannielle.taaffe@oxfaminternational.org
For updates, please follow @Oxfam.