TAX
HAVENS QUESTION OECD FAIRNESS
Legal
Media Group, 25 November 2001
By
Emma Barraclough
Tax
havens have criticized the OECD’s work on unfair
tax competition after the international organization
published a report last week on the project so far.
The
International Tax and Investment Organisation (ITIO),
made up of 13 small and developing countries many
of which the OECD says have harmful tax practices,
has criticized the OECD for failing to operate a level
playing field.
Lynette
Eastmond, director of the group, said: “We would
like to know whether OECD members are prepared to
state that uniform standards must be universally adopted,
without discrimination. Are they and other developed
economies prepared explicitly to confirm their intention
of abiding by the standards demanded of small and
developing economies? Such reassurances would help
build further confidence in the process.”
And
Eastman warned the OECD to be cautious about using
sanctions against tax havens, saying: “There
is a likelihood that any sanctions imposed as a result
of the OECD tax initiative could prove incompatible
with multilateral trade obligations. The ITIO is surprised
that in the current global environment, where it has
been acknowledged that multilateral solutions based
on the rule of law must be found for international
issues, the OECD would still be considering 'naming
and shaming' a few small, developing countries.”
Four
OECD member countries — Switzerland, Luxembourg,
Belgium and Portugal — declined to approve the
publication of last week’s OECD report. The
ITIO said these four included the principal onshore
competitors for the offshore world, and accounted
for many of the tax neutral structures run onshore
within the OECD.
The
ITIO is concerned that business will migrate to these
OECD members if they are not obliged to adhere to
the same standards as offshore centres.
Return
to ITIO in the News index
