OECD Action Plan on tax fails developing countries, says NGO trio

The Organisation for Economic Co-operation and Development’s (OECD) Action Plan tackling multinationals’ tax dodging is a step forward but fails developing countries, the Global Alliance for Tax Justice, Christian Aid and Oxfam have warned.

The OECD’s just published Base Erosion and Profit Shifting (BEPS) Action Plan will be presented to G20 finance ministers’ meeting in Moscow this weekend.

Alex Prats, Principal Economic Justice Advisor at Christian Aid, said: “The Plan is a welcome and long overdue step towards tackling tax dodging by unscrupulous multinationals. The OECD clearly acknowledges that existing international tax rules make it easy for multinational corporations to avoid paying their fair share of tax – as shown by the recent Google and Amazon scandals. We all now agree – with the possible exception of some multinationals and tax havens - that the current situation is unfair and requires urgent reform.”

However, the NGOs point out that developing countries’ inability to participate in the reform process as equal partners is not acceptable.

Oxfam’s senior policy advisor Claire Godfrey commented: “International tax rules affect everyone and it is often the poorest countries that suffer the greatest losses due to tax abuse. Negotiations on new international tax rules must include all countries, including those that are not OECD or G20 members – from the very start.”

The OECD expects the United Nations Tax Committee to help facilitate the contribution of developing countries but Alex Prats warned: “This will only happen if there is a firm commitment to strengthen the UN Tax Committee. With the current level of resources, the UN Tax Committee will most likely not be able to meet the expectations.”

Picture credit © Andres Rodriguez | Dreamstime Stock Photos