View: UN framework, more or less taxing?
international tax arena as India, alongside 110 other countries, voted in favour of a UN Tax Convention Framework. This resolution, backed by 125 countries a month earlier at the UN's Economic and Financial Committee, encountered opposition from 48 countries, notably wealthy OECD members, on both instances.
OECD has been leading international tax reforms.
Its initiatives, often undertaken with G20 support, include combating 'Base Erosion and Profit Shifting' (BEPS) and the ongoing 'two-pillar solution for digital taxation'. These efforts occurred within the 'inclusive framework', a module that engages non-OECD countries in policy formulation.
However, underlying doubts often arose on whether the 'inclusive framework' was truly inclusive for non-OECD countries.
Not all countries were participants, and voices of smaller participating nations were, at times, perceived as being ignored. The moot issue was whether UN, representing 193 countries, should play a prominent role in international tax matters.
On December 30, 2022, the UN general assembly took a significant step by adopting a resolution focused on 'promoting inclusive and effective tax cooperation'.
A decision was taken to initiate intergovernmental discussions, with the UN secretary-general tasked to prepare a report.
The August 2023 report called for an increased role of the UN in global tax affairs. It presented three potential approaches to enhance inclusiveness and effectiveness in international tax cooperation:
A multilateral convention on tax.
A framework convention on international tax cooperation.
A general framework for international tax cooperation.
The first two options would create binding commitments for governments.
