Poor countries fight for global tax reform

| 01/08/2011

(The Guardian): The OECD club of rich countries is battling poorer states over a controversial global tax deal that could affect multinational tax schemes. Visiting South Africa and Nigeria last week, David Cameron wrote in a South African newspaper about the benefits of "effective tax systems" – but failed to mention tax avoidance by multinational corporations, something that South Africa's finance minister has called "a serious cancer eating into the fiscal base of many countries". Meanwhile, the British government is locked in battle with South Africa and other developing countries over a controversial global tax deal, which is due to be finalised in Geneva on Wednesday; a deal that could potentially have a large impact on multinational tax schemes.

It has become a rather hot potato.

On one side of this fight sit Britain, the US, the EU and other rich countries, which want to maintain the pre-eminence of the OECD (Organisation for Economic Co-operation and Development), a club of rich countries, as the body that dominates the setting of global tax rules. On the other side, along with South Africa, sit Argentina, Brazil, China, India, Mexico and other developing countries, which want developing countries to have a bigger voice.

Go to article

Category: Finance

Comments (1)

Trackback URL | Comments RSS Feed

  1. Just Commentin' says:

    It is about time that the rest of the world put a stop to the greedy, arrogant, evil bullies that are collectively known as the OECD. I have no respect for any of the bastards after their threats against the Cayman Islands when they were beginning to force us to sign all their tax treaties. Being a tiny territory we had no recourse against their threats and bullying; but the world is changing and the time is coming when the privileged few will no longer be able to force the many to bow to their whims.

    I see this getting very interesting with China becoming involved in the fray; they cannot be easily bullied, as has been proven by their shrugging off repeated US efforts to get China to change its foreign trade practices. I think Venezuela and the OPEC countries should back this new revolution. That would put a final nail in the coffin of OECD: China has the clout and OPEC controls the oil – the OECD would have no choice but to bow and kiss. 

     

    The two-ton gorilla is about to face off with a new six-ton gorilla that is just beginning to flex its muscles. Sweet scenario!