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Fighting fiscal injustice through the OECD action plan and multilateral co-operation

In adopting a resolution today, based on the report by Georgios Katrougkalos (Greece, UEL), PACE said that taxation was an essential tool for governments to raise the funds necessary for the proper functioning of public services, and that States needed to be provided with a broader tax base to cover their public financing needs.

In the face of aggressive tax planning, tax avoidance and profit-shifting practices by many multinational corporations, particularly in the digital economy, parliamentarians considered that multilateralism was the best means of achieving tangible results and that a consensus at international level was the best way to reform the international tax system and combat fiscal injustice.

The Assembly welcomed the OECD's instrumental role in this context and its work on the Inclusive Framework on Base Erosion and Profit Shifting (BEPS) with a view to reaching a consensus-based agreement on such issues as how taxing rights are determined, how taxable profits are allocated among jurisdictions, and the establishment of a global minimum tax.

In its resolution, PACE also called on member States to avoid “a race to the bottom of national tax systems”, which could undermine sound public finances and high-quality social services for all.

In the face of the health crisis, “governments must continue to provide fiscal support and actively use policy instruments to restore our economies and promote inclusive, resilient and sustainable growth,” said Angel Gurría, Secretary-General of the OECD, in his speech by videoconference during the plenary debate.

He referred to the ongoing negotiations among the 139 member countries of the “Inclusive Framework on BEPS”, on how to address digitalisation’s tax challenges and modernise the international tax system. “The OECD will continue to tackle international tax evasion and avoidance,” he said.

Mr. Gurría welcomed the successful relationship between the OECD and the Council of Europe on tax transparency issues, recalling that the development of the Multilateral Convention on Mutual Administrative Assistance in Tax Matters was “a concrete example of multilateral co-operation", and called for "better policies for better lives".