UN Conference on Trade and Development Calls for More Effective International Tax Cooperation
The United Nations Conference on Trade and Development (UNCTAD) is advocating for more effective international tax cooperation that is inclusive and transparent to facilitate the growth of African countries, particularly by providing specific responses to their needs.
In this context, it is essential to note that mobilizing capital is not always straightforward for developing countries, with only 22 receiving a quality rating. A series of crises, high borrowing costs, volatile external financing, and limited access to affordable public financing all contribute to the current investment deficit for sustainable development goals.
Reforms to the international financial architecture are necessary to increase the budget management capacity of developing countries, enabling accessible and flexible liquidity, debt restructuring, and expansion of development lending. Countries must also effectively mobilize their national revenues by addressing the challenges of tax erosion, trade arbitrage, and illicit financial flows.
The creation of a global tax platform will be essential for strengthening international financial governance and enabling governments to make necessary investments without relying on external sources. Cross-border taxation is also crucial, as many developing countries currently lack the resources to combat the activities of multinational corporations that erode the tax base and transfer profits (BEPS).
The United Nations Convention on International Tax Cooperation aims to ensure equal voices in defining the current order, developing rules, and making decisions related to rules. This could help developing countries better direct their efforts to address the gaps in the global financial system and strengthen national revenue mobilization mechanisms.
