Tag: Tax

New social contract

Financial integrity for sustainable development

By José Antonio Ocampo, Professor at Columbia University, and former UN Under-Secretary-General for Economic and Social Affairs and Finance Minister of Colombia

The world must curb financial flows associated with tax evasion and avoidance, as well as those obtained through corrupt activities and money laundering. The magnitude of the funds involved is immense; trillions of dollars in bank accounts and other assets, and not just in tax havens. The concealed money drains resources from the hands of governments, generates increasing inequality –because the beneficiaries are generally rich people— and causes significant deterioration in public sector governance worldwide. Increased transparency and accountability to curb these flows would improve governance and enhance fairness at the national and international levels.

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Development Matters
Green transition

¿Por qué deberían aplicar precios al carbono los países en desarrollo cuando las economías más avanzadas no cumplen sus propias metas?

Por Jonas Teusch, economista, y Konstantinos Theodoropoulos, estadístico, Centro de Política y Administración Tributaria de la OCDE

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Gravar el uso de la energía en aras del desarrollo sostenible

¿Por qué los países de baja renta deberíanaplicar políticas de fijación del precio del carbono para reducir sus emisiones? Es notorio que las economías más avanzadas del mundo distan mucho de alcanzar el nivel de precios requerido para cumplir los objetivos del Acuerdo de París. Más del 70% de las emisiones de los países de la OCDE y del G20 no tributan en absoluto y más de la mitad no están sujetas a precio alguno, aun tomando en consideración los regímenes de comercio de derechos de emisión.

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Development Matters
Français, Green transition

Pourquoi les pays en développement devraient taxer la consommation de carbone alors même que les économies avancées sont très loin du compte ?

Par Jonas Teusch, économiste, et Konstantinos Theodoropoulos, statisticien, Centre de politique et d’administration fiscales de l’OCDE

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Taxer la consommation d’énergie au service du développement durable

Pourquoi les pays à faible revenu devraient-ils mettre en œuvre une politique de tarification du carbone afin de réduire les émissions de carbone, alors que les économies les plus avancées au monde appliquent des tarifs largement insuffisants pour atteindre les objectifs de l’Accord de Paris ? Plus de 70 % des émissions produites par les pays de l’OCDE et du G20 échappent à tout impôt, et plus de la moitié d’entre elles sont tout bonnement gratuites, même en tenant compte des systèmes d’échange de droits d’émission.

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Development Matters
Green transition

Why should developing countries implement carbon pricing when even advanced economies fall woefully short?

By Jonas Teusch, Economist, and Konstantinos Theodoropoulos, Statistician, OECD Centre for Tax Policy and Administration

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Taxing energy use for sustainable development

Why should low-income countries implement carbon pricing policies to reduce carbon emissions when  the world’s most advanced economies are falling woefully short of the prices needed to reach the objectives of the Paris Agreement? Indeed, more than 70% of emissions from OECD and G20 countries are completely untaxed, and more than half remain entirely unpriced even when accounting for emissions trading systems. Carbon emissions of most developing and emerging economies pale in comparison to OECD and G20 countries. For example, the 15 selected developing and emerging economies1 analysed in a recent OECD report Taxing Energy Use for Sustainable Development account for less than 4% of global emissions, whereas OECD and G20 countries collectively account for more than three quarters of global carbon emissions.

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Development Matters
Covid-19, Latin America and the Caribbean, New social contract

Fiscal policy in the time of COVID-19: a new social pact for Latin America

By Pablo Ferreri, Public Accountant and former Vice Minister of Economy and Finance of Uruguay

This blog is part of a series on tackling COVID-19 in developing countries. Visit the OECD dedicated page to access the OECD’s data, analysis and recommendations on the health, economic, financial and societal impacts of COVID-19 worldwide.

We could say that ultimately the role of government remains unchanged overtime: to achieve ever higher levels of development with the understanding that true development means achieving sustained economic growth while generating greater equity and social cohesion. This must be done through more and better exercise of civil rights and in an environmentally sustainable manner. But in achieving this ultimate goal, challenges change according to realities that governments must face.

Challenges that Latin America faced fifteen years ago, when it enjoyed high levels of growth and a commodity boom in an increasingly open world, are quite different to those that have been brought about by economic slowdown, lower international prices and new isolationist tendencies.

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Development Matters
Building resilience, Covid-19

Reimagining a post-COVID world

By Richard Kozul-Wright, Director of the Globalisation and Development Strategies Division, UNCTAD

This blog is part of a series on tackling COVID-19 in developing countries. Visit the OECD dedicated page to access the OECD’s data, analysis and recommendations on the health, economic, financial and societal impacts of COVID-19 worldwide.

The coronavirus has ruptured our world and, as with past global pandemics, raised fundamental questions about the way we organise society and the values that structure our lives. But it has also encouraged us to imagine a better world. However, if we are to act on that imagination, we will need to acknowledge the mistakes of the last decade, above all in the world’s richest economies.

Recovering better demands that we treat the COVID-19 pandemic as an opportunity to identify and address underlying structural barriers, at both the national and global levels, in the way of a more prosperous, equitable and resilient future. This did not happen after the global financial crisis when returning to business as usual was the winning policy mindset. But higher share prices or fuller treasuries, or more sophisticated supply chains will not be the basis on which future generations judge our response to the current crisis.

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Development Matters
Africa, Français, Natural Resources, New social contract

Victoire historique devant la Cour suprême en Zambie : des milliards de dollars US en recettes fiscales supplémentaires et un message par-delà les frontières

Par Ignatius Mvula, Directeur adjoint, Unité de vérification dans le secteur minier, Administration fiscale de la Zambie, Mary Baine, Directrice, Programmes fiscaux, Forum de l’administration fiscale africaine, et Ben Dickinson, Chef de la Division des Relations internationales et du développement, Centre de politique et d’administration fiscales, OCDE

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En mai 2020, l’administration fiscale de la Zambie (ZRA) a remporté une victoire fiscale historique devant la Cour suprême contre Mopani Mining Copper plc. Le Tribunal a condamné l’entreprise à payer 240 millions de kwacha (13 millions USD) d’impôts supplémentaires. La décision tenait au fait que la Zambie devait baser la partie technique de son dossier en apportant la preuve de l’évasion fiscale par des stratégies de l’érosion de la base d’imposition et du transfert de bénéfices, ou BEPS.

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Development Matters
Africa, Natural Resources, New social contract

Landmark Supreme Court victory in Zambia: collecting millions in tax revenues and sending a message across borders

By Ignatius Mvula, Assistant Director – Mining Audit Unit, Zambia Revenue Authority, Mary Baine, Director – Tax Programmes, African Tax Administration Forum, and  Ben Dickinson, Head of the Global Relations and Development Division, Centre for Tax Policy and Administration, OECD

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In May 2020, the Zambian Revenue Authority (ZRA) won a landmark tax case against Mopani Copper Mining plc in the Supreme Court. The Court ordered the company to pay additional tax of 240 million Kwacha (USD 13 million). The judgement hinged on Zambia making a technical case showing evidence of tax avoidance through base erosion and profit shifting or BEPS strategies. In countries around the world multinational enterprises (MNEs) exploit gaps and mismatches between different countries’ tax systems, costing countries up to 100-240 billion USD in lost revenue annually, the equivalent to 4-10% of the global corporate income tax revenue. Moreover, developing countries’ higher reliance on corporate income tax means they suffer from tax base erosion and profit shifting disproportionately. Zambia and many African tax administrations report that the abuse of transfer pricing rules – the pricing of goods and services between related parties of a multinational enterprise – represents one of the highest BEPS risks to their tax bases.  

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Development Matters
Development in Transition, New social contract

Can middle income countries rise up to their citizens’ expectations?

By Mario Pezzini, former Director of the OECD Development Centre and Special Advisor to the OECD Secretary General on Development[i]

A call for a new social contract

Despite significant economic growth over the past years, middle-income countries (MICs) face increasingly complex challenges related to, among others, a growing demand from their new and still vulnerable middle-classes. As middle-classes have grown in recent decades, so have citizens’ aspirations and demands for quality public goods, better services and a more responsive and transparent state. More educated, better informed, and more connected than ever before, citizens are asking for more voice in public decisions. In parallel, growing aspirations confronted with chronic vulnerability of middle-classes tend to generate frustration and, more and more frequently, social turbulence. Discontent has been erupting for several years in many of these countries, going back to the Arab Spring, with recent examples like Lebanon, and some Latin American countries, including high-income countries like Chile. Today, challenges are exacerbated as the COVID-19 crisis pushes members of the middle class who had previously escaped extreme poverty, back into it. Governments seem increasingly incapable of understanding how people perceive their quality of life.

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Development Matters
Covid-19, New social contract

Tax Inspectors Without Borders: ready to assist developing countries recover from COVID-19

By Pascal Saint-Amans, Director of the Centre for Tax Policy and Administration

This blog is part of a series on tackling COVID-19 in developing countries. Visit the OECD dedicated page to access the OECD’s data, analysis and recommendations on the health, economic, financial and societal impacts of COVID-19 worldwide.

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In the aftermath of the 2008 financial crisis, governments came together to fight for tax transparency and begin the battle against base erosion and profit shifting. It was that crisis that also inspired Tax Inspectors Without Borders (TIWB), which became a joint initiative of the OECD and UNDP at the Addis Finance for Development conference. The initiative helps developing countries to collect the taxes due from multinational enterprises, with countries coming together to assist each other in building tax audit capacity.

We now face an even greater global health and economic crisis, with profound implications for lives and livelihoods. The sharp decline in global and domestic trade and commerce is leading to a commensurate drop in tax revenues, hitting poorer countries hardest due to their reliance on corporate income taxes. Those that depend heavily on tourism, hospitality and remittances from their diaspora may suffer the worst.

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