(New York) Responding to widespread anger about corporate tax avoidance, the impacts of such avoidance on inequality and poverty, and concerns that current tax reform processes are inadequate, a new nonpartisan body— the Independent Commission for the Reform of International Corporate Taxation (ICRICT)—has been established to propose reforms from the perspective of the public interest.
The inaugural meeting of the Commission will take place in New York on March 18-19, 2015. The Commission’s Chair, former UN Under-Secretary-General José Antonio Ocampo, says: “The world has changed but the international tax system has not. Corporations play governments against each other, for example, in encouraging race-to-the-bottom tax incentives, and the public loses out. There are billions of dollars at stake. This Commission will shed light on where the rules of the game, and the institutions that govern them, need to change.”
Mr Ocampo notes that, “Tax policy affects everybody but for too long the debates have been presented as technical and reserved only for tax lawyers and accountants. There is a desperate need to bridge the gap between the technical challenges and everyone’s right to participate and provide solutions.”
The Commission will produce a set of recommendations in the context of the on-going UN Financing for Development agenda and the G20/OECD Base Erosion and Profit Shifting (BEPS) initiative.
The current international tax system reinforces global inequality and hampers poverty reduction—and without changes, will continue to worsen economic and social inequality, including through forcing cuts to vital public services and hindering fulfilment of the post-2015 development agenda. Issues such as fairer allocation of tax rights between source and residence countries, public country-by-country reporting, and requirements for corporations to reveal the location of financial assets will be examined.
Vittorio Longhi, Communications Consultant, Public Services International, Rome –[email protected] psi.org.