UN Engages in Global Tax Reform Negotiations

The United Nations has begun negotiations on a Framework Convention on International Tax Cooperation, a move praised by global labour organisations as a significant step towards tackling tax evasion, harmful competition, and financial disparity.

A statement indicated that the International Trade Union Confederation and Public Services International support the discussions, emphasizing the necessity of a more equitable and inclusive global tax system.

According to ITUC General Secretary Luc Triangle and PSI General Secretary Danny Bertossa, these discussions provide an opportunity for all nations, particularly developing economies, to contribute to shaping tax regulations that affect their financial stability.

“One of the main concerns driving these talks is the growing competition among nations and multinational corporations, resulting in a continuous reduction in tax rates.

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Many companies take advantage of loopholes to shift profits to low-tax jurisdictions, depriving governments of essential revenue required for social services, infrastructure, and development,” the statement noted.

The ITUC and PSI underscored the need for essential reforms to ensure substantial progress in the negotiations, advocating for a majority-based voting system to avoid delays caused by the need for unanimous decisions.

Additionally, they urged the swift implementation of reforms that tax multinational corporations based on where they conduct business, preventing them from transferring profits to low-tax jurisdictions. They also emphasized the need for stringent measures to stop capital from evading national tax systems and ensuring transparent global taxation.

In a joint letter to UN negotiators, Triangle and Bertossa called on all member states to act with “ambition and solidarity” to establish a global tax framework that prioritizes fairness over corporate interests. They warned that without decisive measures, wealth inequality would deepen, and developing nations would continue to face financial constraints.

The UN negotiations, which commenced on February 3, will define the terms of engagement for future discussions. As global labour movements advocate for progressive tax policies, the outcome of these talks could reshape international tax cooperation and advance economic justice worldwide.

“For many developing nations, these negotiations present a crucial opportunity to attain financial independence and overcome systemic disadvantages created by existing tax regulations. The coming months will be pivotal in determining whether the global community can reach a consensus on a tax system that benefits all, rather than just the wealthiest few,” the statement concluded.