GNV News — February 7, 2025

From February 3–6, 2025, negotiations toward a “Framework Convention on International Tax Cooperation” began at United Nations Headquarters in New York, United States. To formally launch these negotiations, the UN General Assembly held multiple rounds of debate and voting in 2024. At that time, only the United States, the United Kingdom, Israel, Australia, Canada, South Korea, Japan, and New Zealand cast votes against (Note 1). Although these eight countries account for about 8% of the world’s population, it is estimated that 43% of the tax revenue lost to international transactions through tax havens and other channels is attributable to corporations and wealthy individuals from these countries.

Until now, the Organisation for Economic Co-operation and Development (OECD), composed of high-income countries, has been at the center of setting international tax rules, but low-income countries that have suffered massive tax revenue losses due to profit shifting by foreign companies have been calling for a more democratic international tax system for over a decade. In the past, high-income countries that benefit from maintaining the status quo in the international tax system blocked such developments, but this time it was realized despite their opposition.

Meetings for the negotiations are scheduled to be held three times a year through 2027. One of the main objectives is “to establish an inclusive, fair, transparent, efficient, equitable and effective international tax system for sustainable development, with a view to enhancing the legitimacy, certainty, flexibility and fairness of international tax rules.”

Note 1: In the November vote, Argentina also cast a vote against.

Learn more about tax havens → “Tax havens and the islands around the Caribbean”

Learn more about capital flight → “A major hidden factor hindering escape from poverty: illicit financial outflows”

United Nations Headquarters, New York (Photo: United Nations Photo / Flickr [CC BY-NC-ND 2.0])