The Organization for Economic Co-operation and Development intends to turn the international tax system inside out over the next two years, with a new plan for global taxation.
Tax avoidance under attack
On July 19th, 2013, at the G20 in Moscow, the OECD revealed its ambition to restructure the international tax system to put an end to the practice of international business fraud. Current international tax rules were established back in 1920. Needless to say, these standards are now insufficient faced with the new challenges brought about by globalization and the digital economy. Fuelled by international contestation, the OECD will now attempt to change the world of finance: in France, numerous complaints have been made against businesses that manage to avoid paying taxes, in the United Kingdom, Starbucks was condemned for fraud in a plan for fiscal optimization…
At the dawn of a revolution
The OECD plans to roll out a plan over the next two years that will focus on two main directives to attain its objectives.
The first measure consists of reducing the overwhelming number of bilateral conventions established between countries and replacing them with multilateral conventions governed by the OECD. The second measure aims to put an end to tax havens by cutting them down at the source by directly opposing the installation of financial set-ups in these countries.
To foster encouragement and economic mobilization, the OECD calls to mind that “collaboration and co-ordination . . . will also be key to provide comprehensive international solutions that may satisfactorily respond to the issue”