The United Nations is spearheading a new initiative to create a global framework for international tax cooperation. This initiative is a response to the inadequacies of the current tax system, which often fails to prevent tax evasion and does not adequately serve the interests of developing nations.
Key Issues Addressed:
The global tax system has been criticized for enabling tax avoidance and not capturing the full tax obligations of multinational corporations.
Developing countries often lack the resources to implement measures that curb tax evasion, leading to significant revenue losses.
UN’s Proposal:
A resolution has been passed to create a more inclusive international tax framework.
This includes a framework convention that aims to secure binding commitments from countries to improve tax cooperation and address tax base erosion and profit shifting.
Suggested Approaches:
A multilateral convention, an international tax cooperation treaty, and a framework for tax cooperation have been proposed.
The suggested framework allows countries to choose which parts they will adhere to, giving them flexibility and respecting their sovereignty.
Next Steps:
An intergovernmental committee will be formed to work out the details of this framework, aiming to ensure equitable representation and considerate negotiation of terms.
The goal is to establish a more equitable system that will allow for fair taxation of multinational companies, ensuring that all countries, especially those in development, receive their fair share of tax revenues.
SRIRAM’s
