Universal Implementation of Taxation Norms Will Boost National Efforts to Mobilize Resources, Deputy Secretary-General Tells Event on Tax Transparency

Following are UN Deputy Secretary-General Amina J. Mohammed’s remarks, as prepared for delivery, at the closing of the event on Sustainable Development Goal Financing, Tax Cooperation and Transparency, in New York today:

Thank you for inviting me to deliver closing remarks on this important topic.

The Addis Ababa Action Agenda highlights that the world needs a globally fair tax system that takes into account the different needs and capacities of all countries, and in particular of developing countries.  Developing this will involve countries taking differentiated approaches and with varying time frames even as they seek to reach the same end point.  It will also necessitate enabling developing countries to participate in key decision-making forums that propose tax norms and that oversee implementation.

There are several challenges and obstacles facing developing-country tax authorities in influencing the global agenda on international tax cooperation.  Not being member countries of the OECD [Organisation for Economic Cooperation and Development], for instance, developing countries have experienced difficulties getting their suggestions and innovations recognized.

There are some positive developments in this area, but we need to keep the key requirement for fairness and participatory approaches under constant review.  The United Nations Committee of Experts on International Cooperation in Tax Matters has an important role to contribute in levelling the playing field in international tax cooperation.  We look forward to the work of the new membership of the Committee beginning later this year.

Tax evasion and money laundering is a global problem that requires concerted global action as it undermines domestic resource mobilization for delivering on the Sustainable Development Goals (SDGs).  International tax cooperation has increasingly looked at setting tax norms to close loopholes, and to increase the exchange of information between tax authorities to help limit tax avoidance by all types of taxpayers.  Member States have committed to a comprehensive set of policy actions in the Addis Ababa Action Agenda and now we have to ensure that these commitments will be implemented.

As this event recognizes, tax transparency is also vital.  For the first time, all United Nations Member States have affirmed norms on exchange of information, put forward by the United Nations Tax Committee in 2016.  Universal implementation of these norms will boost the efforts of all countries to mobilize resources.

While sovereignty in the tax arena is critically important, it must be balanced with recognition that in a globalized world, the actions of one country in tax policy and administration can affect others.  There must therefore be more openness to examine and address these so-called “spillover” effects.  Tax and investment incentives are a good example.  There needs to be a balance between revenue mobilization for immediate development and the need to support longer-term development.  There is important work ongoing in this area for the G-20 [Group of 20], including through joint analysis by the United Nations, the OECD, the World Bank and the International Monetary Fund (IMF).  Effective investment incentives must also be embedded in a broader industrial and sustainable development strategy that contributes to the SDGs.

International tax cooperation is a balancing act.  Informed and transparent decision-making is the best guarantee of that balance.  To help countries further navigate this complex topic the Platform for Collaboration on Tax — which includes the United Nations, the OECD, the IMF and the World Bank — will organize a global conference on tax and the Sustainable Development Goals in New York in February 2018.  I encourage all of you to join us on this occasion.