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Info Service on Biodiversity and Traditional Knowledge (Aug26/04) By Asian Peoples’ Movement on Debt and Development (APMDD) NEW YORK — Midway through the pivotal fifth negotiating session of the UN Framework Convention on International Tax Cooperation at United Nations Headquarters, the Asian Peoples’ Movement on Debt and Development (APMDD) offers preliminary observations on the progress achieved so far. While deep Global North-South divides persist over fair taxing rights and sustainable development goals, APMDD sees real grounds for optimism. Bold leadership from the Africa Group and Asian G77 members has kept developing nations’ interests firmly at the center of debate. To counter “blockers” seeking to dilute the treaty’s ambition, APMDD leaders stress that unwavering unity among Global South nations remains vital to delivering meaningful outcomes for their people. “Unlike decades of closed-door discussions at the OECD, the open plenary negotiations in New York demonstrate that a democratic global tax governance and an equitable international tax architecture are within reach. A transformative framework convention on international tax cooperation is not just a moral imperative, but a massive financial game-changer,” said Charles Santiago, former Member of Parliament of Malaysia and a member of APMDD’s Regional Committee. Santiago is Director of the civil society organization Monitoring Sustainability of Globalization (MSN). “Taxing multinationals where real economic activity, employment, and sales actually occur would allow countries worldwide to collect billions in corporate tax every year without raising tax rates. The transformative impact of this tax boost would be felt most acutely in the Global South where public funding of essential services and measures to address the climate crisis are most urgently needed,” said Jeannie Manipon, APMDD Development Finance Program Manager. According to research, countries can collect US$500 billion more in corporate tax a year from multinational corporations without increasing taxes by securing the UN tax convention’s commitment to change where multinational corporations pay tax. For the Global South, capturing this revenue—yielding over $150 billion annually—would provide more public funding in a single year than the total outstanding loan balance owed to the IMF. This research finds that almost every country stands to gain from a shift to a global unitary taxation. EU member states would gather enough funds to quadruple their spending on climate adaptation in agriculture, energy, and transport, including crucial allocations like €3.7 billion for Spain and €22.4 billion for France to combat devastating wildfires. The United States could expand its current renewable energy spending 45-fold, generating over 265,000 new jobs. The UK would secure enough revenue to cover the newly announced cost-of-living measures six times over, or fund more than two-thirds of the total estimated cost for an NHS-style social care system. This also clearly shows the vast revenues that could be made available for delivering Global North countries’ obligations on climate finance and reparations. “We are at a historic crossroads,” said Manipon. “Midway through these talks, we see real momentum toward reclaiming the trillions lost to tax abuse. But unlocking that $500 billion prize requires holding the line against wealthy nations seeking to carve out loopholes and diminish the treaty’s enforcement.” Manipon added: “The transition toward taxing corporations directly where they do business and generate profits, as seen in the current deliberations on the draft Convention text, has seen encouraging progress. Developing nations, led by the African Group, India, and Brazil, have successfully driven discussions away from outdated physical presence requirements toward real economic nexus, digital market presence, and to the fundamental objective of ensuring fair allocation of taxing rights. However, higher ambition is urgently needed as OECD members and business lobbies attempt to water down the Convention, pushing for voluntary guidelines instead of binding rules. We need explicit, mandatory unitary taxation text that stops profit-shifting into secrecy havens once and for all.” On overhauling predatory bilateral treaties, fundamental reform remains stalled as key developed nations and low-tax hubs, including EU members, the UK, Japan, and the UAE, continue to block higher ambition. “They are pushing to preserve legacy treaties that lock in historic disparities and shield powerful interests from systemic change. Global South unity vital to replacing unequal tax deals with a fair international framework,” said Santiago. “APMDD insists on retaining unconditional obligations to renegotiate unequal treaties aligned with timelines that should be enforced by the future Convention’s Conference of Parties (COP).” “The $500 billion revenue boost identified by experts demonstrates what is at stake in these halls,” he concluded. “Countries cannot afford another decade of diluted compromises. We enter Week Two with optimism because the Global South stands united, and we will continue fighting for a treaty that delivers genuine economic justice for our communities.” Manipon pointed out that civil society’s call for greater ambition in the UN Tax Convention is matched with a powerful, united front. A broad coalition of advocates and movements, coordinated globally by the Global Alliance for Tax Justice (GATJ) and regionally by Tax and Fiscal Justice Asia (TAFJA), is undeniably a major actor in the negotiations. “Through rigorous, substantive articulations on progressive taxation, illicit financial flows, gender and climate justice, and the systemic reform of global tax governance, civil society continues to push for maximum ambition to overcome resistance from developed states,” she said.
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