EU, UK under fire for allegedly sabotaging the tax influence of Ghana Nigeria and others—FT

European Union and British diplomats have faced accusations of attempting to “kill” measures aimed at giving developing nations like Nigeria, Ghana, Brazil, India, and others a stronger role in international tax discussions. Countries are in negotiations at the UN to increase the UN’s influence in global tax debates; low- and middle-income nations are pushing for this change according to Financial Times. For many years, the Organisation for Economic Cooperation and Development (OECD) has brought together nations to discuss issues related to international taxation. However, authorities in several emerging economies have criticised the organisation, claiming it does not adequately represent their concerns.

A Financial Times story claims that a group of 54 African nations, who were dissatisfied with the OECD procedure, successfully introduced a resolution before the UN General Assembly last year. This suggested that in order to improve the “inclusiveness and effectiveness” of international tax cooperation, the UN secretary-general should prepare a report that included recommendations for increasing the UN’s influence in the global tax arena. The UN secretary-general released a report in the summer outlining three possible solutions that would give the UN more of a role in international tax cooperation: two legally binding and one optional. The proposal was unanimously approved in November 2022. The Financial Times was informed by a developing-nation negotiator that the EU and the UK had been adamantly against supporting any of them. The resolution called for a report. They’re rubbishing that report and they’re out to rubbish the entire process and just kill it. They don’t want to bring taxation matters here [to the UN],” said the negotiator.

“We’ve tried to negotiate in good faith. The EU and the UK are not willing to do that and are trying to delay the process,” another negotiator from a developing country said. “It’s a grand scheme to keep the status quo and keep developing countries at the periphery [of global tax discussions,” the negotiator added.

Nigeria, Ghana, India, Brazil, and other developing nations have been advocating for a legally enforceable involvement in UN tax discussions. Nonetheless, European nations fear that an expanded role for the UN will jeopardise current OECD practices and split the global tax system. To combat corporate tax evasion, the OECD presented a ground-breaking tax agreement in 2021. However, ratification concerns and delays have plagued its implementation. In September, EU finance ministers said EU member states “could consider working at the UN on a non-binding multilateral agenda for coordinated actions”. Negotiation papers obtained by the Financial Times, however, revealed that the EU and other countries had attempted to withdraw their support for even the voluntary alternative put forward in the secretary-general’s report. Rather, they have supported the establishment of a new working group that will put up other possibilities for a UN function and revisit them for consideration at the UN General Assembly, which will convene in September 2025, for the 80th time.