A deeper disagreement over the appropriate forum to advance the agenda was covered up by the first-ever joint declaration by G20 finance leaders on Friday, wherein they pledged to cooperate in order to effectively tax the world’s largest fortunes.
The Group of 20 major economies’ finance ministers and central bankers decided to discuss fair taxation of “ultra-high-net-worth individuals” in their joint statement and in a separate statement on international tax cooperation that was released on Friday.
“We aim to collaborate to guarantee that extremely wealthy people are fairly taxed,” the G20 ministerial declaration’s final draft, obtained by Reuters, stated in Rio de Janeiro.
However, disagreements have already surfaced over whether to pursue that in negotiations at the UN or through the Organisation for Economic Cooperation and Development (OECD), a consortium of affluent democracies established by allies in the US and Europe.
On the fringes of the G20 summit, U.S. Treasury Secretary Janet Yellen told Reuters that she thought the OECD, which oversaw discussions for a global two-part corporate tax agreement for the previous three years, was better suited to lead such discussions.
Yellen stated, “We don’t want to see this shifted to the UN,” noting that the OECD “is a consensus-based organisation.” We’ve come a long way, and the UN lacks the technical know-how to continue this.
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