(Ecofin Agency) - Actors of the international civil society are calling world leaders at the World Economic Forum currently taking place in Davos, Switzerland, to support a genuine international tax reform that would benefit everyone.
According to the Independent Commission for the Reform of International Corporate Taxation (ICRICT), “all countries have a stake in developing a sustainable international tax system that can help to deal with the extreme inequality of today.”
“After decades of inaction, the OECD made an important move challenging the very foundation of the international tax system, which is the ability of multinationals to report their profits in the subsidiary of their choice. In this debate, however, we do not play on equal terms. Rich countries have more human, political and financial resources to make their views prevail,” said José Antonio Ocampo, President of ICRICT.
The independent council's demand goes in the same direction as an Oxfam report that decried the gap between the world's richest and poorest. ICRICT denounced a bad taxation of multinationals which deprives governments, especially those of developing countries, of important resources that could serve their populations.
International taxation remains less discussed at the Davos Forum which rather mainly focuses on climate change issues. At the end of January 2020, the Organization for Economic Co-operation and Development (OECD) is expected to host a meeting to discuss tax reforms. But the institution's proposals are considered to be unambitious.
In many African countries, the International Monetary Fund is asking struggling governments to strengthen the consolidation of their budgets. This is a difficult task because fiscal consolidation does not benefit small and very small companies, while large groups benefit from attractive fiscal agreements signed by their states.