UN Secretariat Publishes Note on Domestic Taxes for SDGs
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The 18th session of the Committee of Experts on International Cooperation in Tax Matters will take place from 23-26 April 2019, in New York, US.

The note published on 11 February 2019 aims to provide background on how the Committee’s work can support countries in three areas: taxation and environmental protection; taxation of the informal economy; and taxation and gender equality.

11 February 2019: The role of taxation and domestic resource mobilization in achieving the SDGs is the focus of a Note by the UN Secretariat. Prepared for a meeting of the UN Committee of Experts on International Cooperation in Tax Matters, the Note underlines that fiscal policies “have a fundamental role” in promoting many aspects of sustainable development, especially the reduction of inequality (SDG 10), through both tax policies and expenditure, and the promotion of other policies and behaviors in support of the 2030 Agenda.

The Note was issued ahead of the Committee’s 18th session taking place from 23-26 April 2019, at UN Headquarters in New York, US. The document builds on a previous paper on the same topic (E/C.18/2018/CRP.19) presented at the 17th session of the Committee. That paper provides an initial overview of how the Committee’s work could help realize the commitments related to taxation “as the main driver of domestic resource mobilization” contained in the 2030 Agenda and the Addis Ababa Action Agenda (AAAA) on financing for development (FfD). It focuses on international tax cooperation, taxation of the digitalized economy, tax exemptions for official development assistance (ODA), and gender and taxation.

The Note published in February 2019 (E/C.18/2019/2) aims to provide additional background on how the Committee’s work can support countries in three areas: taxation and environmental protection; taxation of the informal economy; and taxation and gender equality. By the text, the key challenge faced by all countries in the three areas of focus is the need to reach a balance between effective revenue collection and social and environmental protection.

According to the document, achieving that balance will require:

  • Developing coherent fiscal systems, where revenues are collected in a progressive way and redistributed to promote opportunities for the most vulnerable groups, including women;
  • Ensuring that taxation encourages behaviors that are aligned with the 2030 Agenda, such as environmental protection, innovation and formalizing informal economic actors; and
  • Supporting simple and effective tax administration, to encourage tax compliance and promote fairness.

As keys tools to support developing countries in that direction, the Note identifies practical guidance by the Committee, paired with peer learning and targeted capacity development. For countries in special situations, including countries in situations of conflict, post-conflict countries, and the least developed countries (LDCs), the text calls for innovative solutions, such as simplified tax regimes or enhanced revenue collection through customs duties.

The 18th Session of the Committee will focus on: the next update of the UN Model Double Taxation Convention between Developed and Developing Countries, and the mutual agreement procedure — dispute avoidance and resolution; the next update for the Transfer Pricing Manual; the Extractive Industries Handbook; the Manual for the Negotiation of Bilateral Tax Treaties; and treatment of collective investment vehicles, taxation of development projects, capacity-building activities, environmental tax issues, tax consequences of the digitalized economy and tax and the SDGs. Following the Committee’s session, the UN Economic and Social Council (ECOSOC) will hold a Special Meeting on International Cooperation on Tax Matters on 29 April 2019. [Publication: Follow-up note on the role of taxation and domestic resource mobilization in achieving the Sustainable Development Goals]


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