Sharing the Tax Pie: Revisiting the Role of the UN, EU & OECD in Tax Policy; and Taxable Presence Threshold (Fixed Establishment) in Indirect Taxation

The year 2024 brings new tax policy developments with the potential to become the most significant recent changes in the global tax architecture. Seeking a greater role for the United Nations, the UN General Assembly voted in favour of a Resolution on the Promotion of Inclusive and Effective International Tax Cooperation at the United Nations, directly challenging the OECD leadership in international tax matters. The vote on a resolution filed by Nigeria and other developing countries saw a clear divide between developed countries, such as the EU, US, UK and Japan, and the rest of the world. The UN vote followed an earlier Report from the UN Secretary General, calling for a greater role of the UN in setting the international tax affairs in order to achieve a “fully inclusive” international tax agenda. The UN Secretary General Report also notes that the rules developed at the OECD do not adequately address the needs and priorities of developing countries and/or are beyond their capacities to implement.

CFE’s 2024 Forum will bring two excellent panels of speakers to discuss the allocation of tax base (Pillar 1 and the role of the UN, the EU and the OECD in international tax matters). Secondary taxation rights, in particular the subject to tax rule (STR) in the UN Model Tax Convention and OECD’s Pillars bring up issues of divergent aspirations in tax policy between jurisdictions.

Similarly, fixed establishment, combined with transfer pricing aspects, brings aspects of indirect taxation closer to the debate on profit allocation in a cross-border taxation context. In a digital context, similarities and differences between FE and PE are increasingly relevant, looking at the questions around force of attraction.