This evening, the Organisation for Economic Co-operation and Development (OECD) announced that a new tax agreement had been reached by the Inclusive Framework, while at the same time explaining that four developing countries that are members of the framework – Kenya, Nigeria, Sri Lanka and Pakistan – have decided not to join the agreement.

Commenting on the outcome of the OECD-led negotiations, Tove Maria Ryding, Tax Coordinator at the European Network on Debt and Development (Eurodad), said:

“If anyone needed more evidence for why global tax rules should not be set by secretive bodies where countries are not able to participate on an equal footing, this is it. The OECD has produced a deal that has strong biases towards the interests of larger and richer countries, at the expense of the world’s poorest countries. At the same time, the deal fails to stop corporate tax avoidance and harmful tax competition between countries. The deal is bad for everyone, but worse for developing countries.

“We are in the midst of a global crisis, and urgently in need of a fair and effective corporate tax system. As long as multinational corporations are not paying their fair share, we will all be paying the price in the form of failing public services, austerity and regressive taxes.

“Compared to the scale of international corporate tax avoidance, this deal will even at best only deliver peanuts in extra tax income for governments, and unfortunately, the deal says that most of those peanuts should go to the rich countries.

“A minimum corporate tax rate of 15 per cent was always too low to ensure fair taxation of multinational corporations. But today’s deal includes carve-outs that water down the rules even further. At the same time, the failed transfer pricing system is set to continue. The deal is rubberstamping the failing corporate tax system.

“The OECD-led negotiations have been highly secretive, and were never anywhere near global. Over one-third of the world’s countries have not been participating in the negotiations, and the world’s least developed countries are strongly underrepresented at the table. It is high time to initiate a truly inclusive, transparent and country-led negotiation at the United Nations to stop tax havens and fix the failed international tax rules.”

For more information about which countries have participated in the OECD-led negotiations, see this briefing produced by Eurodad and the Financial Transparency Coalition.

ENDS

Media contact: Julia Ravenscroft, Communications Manager, Eurodad: [email protected]/ +44 7958184695.