A century since the League of Nations first began to discuss international taxation, global tax governance is at a major inflection point. This year provides an unprecedented opportunity to debate what is needed from institutional arrangements, as well as the subject matter of multilateral cooperation.
A decade of experimentation in multilateralism at the OECD has succeeded in further integrating many lower-income countries into international organisations, treaties and standards, but alongside it is a sense of expectations unfulfilled. Some countries have made progress applying international standards for exchange of information and corporate taxation, but many are limited by capacity constraints. There is a growing appetite for more radical redistribution and simplification, which is unlikely to be satisfied by the current round of negotiations in the 142-member Inclusive Framework.
Meanwhile, at the United Nations, the Committee of Experts is increasingly setting a different course, and its agenda is expanding to cover topics such as wealth and environmental taxes. Intergovernmental discussions set to begin in 2023 could lead to a new global tax convention that reshapes the landscape of global tax governance.
There are developments, too, at the regional level. The African Union is beginning to build on ATAF’s strong presence in multilateral negotiations, while the Colombian government has initiated regional discussions in Latin America and the Caribbean. Some countries are becoming emboldened to adopt unilateral measures that break with the historical consensus, notably in the digital economy.
In this context, the ICTD is hosting a research and policy conference in partnership with the Kenya School of Revenue Administration, and with the participation of local universities (The Committee on Fiscal Studies at the University of Nairobi and the Strathmore University Law School). Panels will include insights from cutting-edge research and key actors in tax policy and administration. While in-person participation in Nairobi is by invitation, three panels and the annual ICTD Lecture will be livestreamed for online audiences.
Watch the discussions by tuning in to the sessions we will stream live on our YouTube channel.
Monday June 5th, 11:00 – 12:30 EAT
This panel will cover lower-income countries’ achievements in international tax negotiations, the challenges they face, lessons learned and future prospects. The panel will be moderated by Miranda Stewart, of the University of Melbourne, and will feature:
- Rasmi Das, Ministry of Finance, India
- Marlene Parker, Ministry of Finance, Jamaica
- Yariv Brauner, University of Florida
- Eric Mensah, Sam Okudzeto & Associates
- George Obell, Kenya Revenue Authority
Monday June 5th, 15:30 – 17:00 EAT
This panel will cover Kenya’s participation in regional and multilateral institutions; its adoption of international tax instruments; successes and challenges in cross-border taxation; and experience of the Digital Services Tax. The panel will be moderated by Alvin Mosioma of the Open Society Foundations, and the speakers will be:
- James Karanja, Anjarwalla & Khanna
- Cromwell Pkomu, National Treasury, Kenya
- Veronica Ndegwa, Institute of Public Finance
- Everlyn Muendo, Tax Justice Network Africa
Tuesday June 6th, 15:30 – 17:00 EAT
The ICTD Annual Lecture will be given by Mary Baine of the African Tax Administration Forum. ICTD Research Director Giulia Mascagni will moderate, while the following will act as discussants:
- Annet Oguttu, University of Pretoria
- Nana Akua Achiaa Amoako Mensah, Ghana Revenue Authority
- Chenai Mukumba, Tax Justice Network Africa
Watch live here.
Wednesday June 7th, 9:00 – 10:30 EAT
This panel will feature presentations of three books/papers studying the history of multilateral cooperation, including the role of the UN and implications for lower-income countries. Annet Oguttu, from the University of Pretoria will moderate, while the speakers will be:
- Nikki Teo, University of Sydney (presenter)
- Matti Ylonen, Helsinki University (presenter)
- Steven Dean, Brooklyn Law School (presenter)
- Lyla Latif (discussant), University of Nairobi (discussant)
- Muhammad Ashfaq Ahmed, Federal Board of Revenue, Pakistan (discussant)
Watch live here.
The conference will focus on several intersecting themes:
The future of global tax governance
As lower-income countries become more vocal and more organised in multilateral negotiations, what institutions – and what legal instruments – do they need? How can existing multilateral institutions accommodate the interests of so many diverse countries? What should be the role of regional bodies? Can institutions bridge the gap between policymakers and tax administrations?
Services and digitalisation
Today’s economies are characterised by a bigger role for services and an increasingly digital mode of delivery. Lower-income countries have adopted a variety of responses to deal with the tax challenges of this development: some have already adopted ‘unilateral’ measures, while others are waiting for OECD negotiations to run their course. At the same time, the UN Tax Committee has offered an alternative. What lessons can already be drawn from experiences with direct and indirect taxes, and what other potential reforms should countries consider?
Taxing the wealthy
The taxation of wealthy individuals is high on the political agenda in both higher and lower-income countries. A key question is whether the most effective approaches are through new taxes on wealth, or by adapting and strengthening existing taxes, such as on personal incomes, property and capital gains. International cooperation plays a role here, from appropriate treaty provisions to exchange of information.
What role can taxation play in supporting lower-income countries’ nationally determined contributions to carbon emissions reductions? Global attention is on carbon taxes, where the EU and OECD are driving the emergence of a new regime. Can other tax measures, such as taxation of shipping and airlines, have an impact on revenue and emissions in lower-income countries?
Even as new negotiations continue at pace, it is becoming clear that existing tax treaties limit countries’ ability to act on the other challenges considered at this conference, for example taxing service providers, wealthy individuals or carbon-intensive industries. So far only a few have been terminated or significantly renegotiated. How should existing treaties, as well as new ones, be reformed?
Taxing MNEs: experiences with transfer pricing
In recent years, more and more lower-income countries have implemented sophisticated transfer pricing rules to deal with the problem of cross-border income shifting. New insights are emerging on the drivers of these reforms and their impact in practice. How can countries manage to build up sufficient capacity and how can international standards accommodate the specific situation of lower-income countries?
Exchange of Information
Newly introduced conventions and procedures allowing for exchange of information on request between tax administrations are slowly starting to bear fruit in the fight against tax evasion. Meanwhile, a few African countries have already adopted automatic exchange of information. However, many challenges remain: How to analyse received data and match it with data received from other sources? How to protect data effectively to ensure continuing trust by partner tax administrations?
The Pillar 2 project has put minimum taxes in the spotlight. At the same time, domestic alternative minimum taxes are already in place in many African countries and are currently witnessing a global revival. The potential impact of minimum taxes on reducing tax avoidance by MNEs has received a lot of attention. However, the key question for many countries remains: How to adjust an industrial policy built on targeted tax incentives towards the change that is under way?
Digital financial services – new taxes and administrative practices
Many governments across Africa have responded to the rise of mobile money transactions by introducing new taxes on digital financial services. These taxes have come in different forms and their rationale and design is still debated. How can countries raise revenue in a way that does not stifle economic activity and does not target low-income taxpayers?