Civil society claims for an intergovernmental commission on tax cooperation
Published on Fri, 2011-07-01 11:57
Some 50 civil society organisations from all over the world claimed this week for the creation of an Intergovernmental Commission on International Cooperation on Tax Matters to protect nations from abusive practices, including evasion and the race to the bottom in corporate taxation. The claim is headed by the international networks of development groups Eurodad, CIDSE, ActionAid, Christian Aid and the Tax Justice Network (TJN), and the Danish group Ibis.
The organisations signed an open letter to all governments asking them to create this commission in the upcoming sessions of the UN's Economic and Social Council (Ecosoc), without removing the existing Committee of Experts that must be “better resourced”, informed TJN.
According to the call, the OECD wants to carry out the function of monitoring tax practices, but “lacks legitimacy and too many of its prominent members are tax havens or secrecy jurisdictions”, explained TJN in a communiqué.
Next is the open letter sent on June 28 to the governments, also signed by focal points of Social Watch as the National Centre for Development Cooperation (Belgium), Alliance Sud (Switzerland) and the Third World Network (Malaysia).
Join the call for stronger UN role on tax matters!
We, the undersigned, are writing to request that, at the upcoming deliberations of the Economic and Social Council 2011, your government endorses the proposal for creating an Intergovernmental Commission on International Cooperation in Tax Matters, while retaining the UN Committee of Experts on International Cooperation in Tax Matters as a subsidiary body.
In December of 2008, the Doha Review Conference on Financing for Development called for the Economic and Social Council to examine ways to strengthen institutional arrangements for international cooperation in tax matters. In the report requested by resolution 2010/33 of the Economic and Social Council, the Secretary General elaborated on a number of options to achieve that goal. We are writing to express our strong support to option 3 stated in such report, namely, the creation of an intergovernmental commission on international cooperation in tax matters, while retaining the UN Committee of Experts on International Cooperation in Tax Matters as a subsidiary body.
Developing countries have a large stake on issues of mobilization of domestic resources as these are a cornerstone of efforts for financing development. For this reason, while there is a general need to strengthen and broaden the participation of developing countries in global economic governance, nowhere is such need more justified than in the area of intergovernmental cooperation on tax matters. Such intergovernmental decisions influence the key principles that determine and constrain developing countries’ ability to succeed in taking their fair share of revenue in an environment where the tax base is increasingly global and capacity to tax increasingly interdependent. Without an effective representation of their interests, rhetorical commitments to enhance and strengthen mobilization of domestic resources risk being deprived of any meaning.
The seriousness of these considerations is further underscored by the current role of mobilization of domestic resources in the overall development finance landscape. The financial crisis of 2008-09 and continued financial turmoil in its wake have resulted in development finance flows being negatively affected. Climate change has wiped out some of the gains booked by the concerted effort to achieve some development goals and raised the need for additional resources to fund mitigation and adaptation.
All these factors underline the imperative for sustainable sources of finance- through ODA but ever more importantly through setting conditions that enable countries to raise their own financial resources including through taxation. Against this backdrop, the lack of a forum that could provide the required weight to the interests of developing countries on international cooperation in tax matters is all the more striking. Whilst the OECD has considerable expertise, and is able, on occasion, to consult non-members or invite them to meetings – its primary focus and expertise relates to established, industrialised economies. As recently put by an OECD representative speaking at the UN, the OECD does this only in order to seek a broader range of views on decisions that, ultimately, are a matter for its own membership to make.
The challenges and needs of poor economies with respect to taxation are very different and cooperation between developed and poor economies on taxation issues should take place in a more inclusive and representative forum. The widespread use of the UN Tax Committee’s model tax convention in negotiations, the interest in its practical manual on transfer pricing, and the strong support from developing countries for an intergovernmental Commission on International Cooperation in Tax Matters underlines the effectiveness and representativeness of the UN in the global effort towards greater tax cooperation .
It is therefore essential that funds be found to support these and to finance greater developing country participation in meetings, either from reallocating existing UN funds or from a reprioritisation of resources currently made available to other international bodies, such as the OECD task force and the IMF trust fund.
Thank you in advance for your kind consideration of this request.
Sincerely yours, Signatories:
Alex COBHAM, Christian Aid, UK
Bernd NILLES, CIDSE
Núria MOLINA, EURODAD
Lars KOCH, IBIS-Denmark
John CHRISTENSEN, Tax Justice Network International Secretariat
Rudy DE MEYER, 11.11.11-Belgium
Anna THOMAS, ActionAid UK
Martin TSOUNKEU, Africa Development Interchange Network, Cameroon
Elvire EUGENE, Association Femmes Soleil d'Haiti
Mark HERKENRATH, Alliance Sud-Switzerland
John LANGMORE, Anglican National Public Affairs Commission-Australia
Prem SIKKA, Association for Accountancy & Business Affairs-UK
Andreas MISSBACH, Berne Declaration-Switzerland
Andrea BARANES, Campagna per la riforma della Banca mondiale-Italy
Helen OJARIO, Carmelite NGO-USA
Germaine PRICE, Company of the Daughters of Charity of St. Vincent de Paul-USA
Laust Leth GREGERSEN, CONCORD Denmark
Griselda MARTINEZ-MORALES, Congregations of St. Joseph-USA
P.A. SURENDRAN, Consumers Association, Palakkad, India
Margaret MAYCE, Dominican Leadership Conference-USA
Markus BRUN, Fastenopfer-Switzerland
Mama KOITE, African Women’s Development and Communication Network-Mali
Emira WOODS, Foreign Policy in Focus-USA
Mathilde DUPRÉ, Plateforme Paradis Fiscaux et Judiciaires-France
Raymond W. BAKER, Global Financial Integrity
James A. PAUL, Global Policy Forum-USA
Fatima RODRIGO, International Association of the Sisters of the Presentation-USA
François GOBBE, Kairos Europe WB, Belgium
Janice G FOERDE, KULU-Women and Development-Denmark
Steven O'NEIL, Marianists International-USA
Marie DENNIS and Kathy MCNEELY, Maryknoll Office for Global Concerns-USA
Celine PARAMUNDA, Medical Mission Sisters-USA
Missionary Oblates of Mary Immaculate-USA
Martha GALLAHUE, National Ethical Service-USA
Jo Marie GRIESGRABER, New Rules for Global Finance-USA
Elin ENGE, Norwegian Forum for Environment and Development
Kevin DANCE, Passionists International and NGO Committee on Financing for Development-USA
Thomas BRENNAN, Salesian Missions-USA
Faith COLLIGAN, Sisters of Charity Federation-USA
Eva HANFSTAENGL, Social Justice in Global Development-Germany
Katrin MCGAURAN, Centre for Research on Multinational Corporations, The Netherlands
Dedi HARYADI, Taxation Advocacy Group-Indonesia
Nicole TICHON, Tax Justice Network USA
Hans-Rudolf SCHELLER, Tax Justice Network-Switzerland
Richard MURPHY, Tax Research LLP-UK
Raffaele SALINARI, Terre des Hommes International Federation-Austria
Bhumika MUCHHALA,Third World Network-Malaysia
Susan GEORGE, Transnational Institute, The Netherlands
Hernán CORTÉS, UBUNTU Forum-Spain
Catherine FERGUSON, UNANIMA International-USA
Daniel LEBLANC, VIVAT International-USA
Josep XERCAVINS, World Democratic Governance-Spain