Thursday, May 19, 2011

OECD may detract from UN work

For those many millions of people with a subscription to Transfer Pricing Week, it's currently carrying a useful article following our blog entitled "Developing countries are finding their voice". It quotes Martin Hearson of ActionAid as saying
"The OECD’s proposed Global Forum for transfer pricing, which will institutionalise the involvement of developing countries, may detract from the UN’s tax committee and the work it is doing for developing countries"
As the article notes, developing countries have more allegiance to the UN because the OECD is seen as an organisation aimed at developed countries. TP Week carries this summarising sentence:
"In response to the claims the OECD is competing with the UN for time and resources, Owens said the OECD contributes extensively to the UN work on taxation."
we might mischievously re-summarise the last 10 words of that sentence like this:
" . . . the OECD interferes extensively with the UN work on taxation."
Which is essentially saying the same thing. But it supports what we've been saying all along.

Now there certainly is a case for co-ordination among international organisations on issues such as this - having lots of different systems is potentially a recipe for arbitrage by corporations. What we object to is the fact that the OECD remains firmly in the driver's seat, pushing policies that, as we've demonstrated, are to the detriment of developing countries. And it quotes:
"The OECD is comprised of 30 wealthy countries and its origins are in Europe,” said Glenn DeSouza of Baker & McKenzie in China. “As such, its views and biases tend to be representative of the wealthy economies who now see jobs migrating to China and India. The OECD bus is driven by the wealthy nations. . . . China and India are passengers.”
And, as we mentioned, developing countries are finding their voice. Interesting times, indeed.

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