In Panama Papers revelations, UN tax commission proposal gains new urgency
April 18th, 2016
April 18th, 2016
NEW YORK CITY—As the fallout from the Panama Papers continues to unfold, the massive scale of illicit flows across the globe illustrates the need for an intergovernmental tax commission at the UN to tackle these problems in an equitable and effective way.
“When you look at the ten favorite jurisdictions used by Mossack Fonseca to set up shell companies, the list spans the globe, offering choices in every region of the world,” said Pooja Rangaprasad, Policy Coordinator of the Financial Transparency Coalition. “But our current decision making bodies just don’t have the same global representation, making it imperative that we upgrade the UN tax committee to a full fledged intergovernmental commission that can tackle these challenges with buy-in from everyone.”
Most current transparency and anti-tax abuse standards are being set by the Organization for Economic Cooperation and Development (OECD) and the G20, two selective groups of wealthy countries. Developing countries have not been a part of the design of these global rules, and they are increasingly seen as politically motivated and piecemeal.
But last year, world leaders debated a proposal to upgrade an existent UN tax committee to an intergovernmental body, with political clout and financial resources, during negotiations at the 3rd UN Financing for Development Conference in Addis Ababa, Ethiopia. The proposal was blocked by a small group of OECD countries, most notably the United States and United Kingdom.
“We can’t keep having twenty per cent of the world’s countries dictating what the other eighty per cent should or should not do to tackle illicit financial flows and tax abuse,” said Tove Ryding, Tax Justice Coordinator for Eurodad. “It’s past time to give the UN tax committee the resources and political backing to provide a space for the inclusive discussions that are urgently needed to combat illicit flows effectively.”
Civil society organizations and government negotiators are at the United Nations ECOSOC Forum on Financing for Development follow-up this week, discussing the next steps to move forward from last year’s Financing for Development Agreement, known as the Addis Ababa Action Agenda.
“We know that low income countries suffer disproportionately at the hands of tax abuse and illicit financial flows, and low income governments are increasingly taking the lead in addressing the problem. But they are still not given a seat at the table when global rules are being set; it’s only after the ink dries that they are invited to join in their implementation,” said Oriana Suárez of Latindadd. “If we’re serious about dismantling the shadow financial system, it’s time we upgrade the UN tax committee, as proposed by so many governments and civil society groups last year in Addis Ababa.”
Notes to Editors:
 The Panama Papers showed that Mossack Fonseca utilized jurisdictions in Europe, Asia, Africa, and the Americas to set up anonymous shell companies for their clients.
 There is currently a UN Committee of Experts on International Cooperation in Tax Matters, but to be able to make meaningful inputs on global standards, it must be upgraded to an intergovernmental body with political and financial backing.
 Last July, a small minority of OECD nations blocked a proposal to upgrade the current UN Tax Committee as part of the Addis Ababa Action Agenda.
Christian Freymeyer, +1.410.490.6850, firstname.lastname@example.org