OECD Tax and Development Programme, Phase II

International taxation is high on the agenda as the globalised and digital economy facilitates tax evasion and avoidance through international transactions. The issue is especially relevant for developing countries that have lower capacity and a stronger dependence on taxing multinational enterprises. This programme addresses these issues by enabling developing countries to actively participate and implement internationally agreed standards in the area of base erosion and profit shifting (BEPS) and exchange of information (EOI). These activities will be complemented by activities in tax administration, tax policy and development cooperation.

More effective domestic revenue mobilization that will lead to increased financing of social services and investments in the beneficiary countries, which will support reaching the Sustainable Development Goals (SDGs). The goal will be achieved by a combination of activities in three complementary workstreams: BEPS, EOI and Mainstreaming Tax for Development. The former two workstreams focus on international taxation and strengthen the ability of countries to fight tax avoidance and evasion. The third workstream combines activities in the area of tax administration, tax policy and tax-related development cooperation. Taken together, these areas should enable countries to collect higher revenues, which in turn will reduce the dependency on aid and will create fiscal space to finance infrastructure and social services that are required to reach the SDGs.

In relation to BEPS, developing countries (i) enhance their legislative, organisational and human resource capabilities, (ii) participate in the standard setting and policy process, and (iii) implement the package of minimum standards.

In relation to EOI, developing countries (i) engage and commit to the international standards, (ii) are able to effectively implement and apply the international standards, and (iii) use the EOI tools and information obtained through their application.

Improved tax policy implemented.

Tax authorities use information and tools developed in fighting tax evasion to help in the fight against other serious economic crimes.

Tax administration performance of developing country improved.

Revenue statistics are made available and are used for analysis.

CTPA plays an active role in development cooperation and co-ordination.

Expected results:  

Support in the BEPS process through toolkits, guidance, and other diagnostic work, induction programmes, consultations and bilateral assistance- peer-reviews and action plans- and country assistance by tax inspectors without borders programme.

Support in the EOI process through technical assistance and other constructive engagement with developing countries- multilateral platforms- toolkits, model laws and other ready-to-use solutions.

Country tax policy analysis in health financing, dynamic fiscal framework etc.

Support to develop and implement environmentally related taxes through the provision of data and training.

Support to Value Addeed Tax design, e-commerce toolkit and training.

Training through Tax and Crime Academies.

Tax and crime Guide and Maturity model.

Report on tax technology tools for developing countries and production of maturity models.

Different revenue statistics, including with online access.

Results from previous phases:  

The number of developing countries in the inclusive framework was 66 by the end of 2019, increasing their influence to find approaches to international taxation suited to developing countries. The capacity of these countries to fight tax evasion and avoidance has also improved, as is evidenced by the number of tax cases that have been resolved and additional revenues collected. With regards to information sharing, a widespread implementation of the international standards of transparency and exchange of information for tax purposes is being achieved. Currently, 86 developing countries are members of the Global Forum, 67 of which have signed the Convention on Mutual Administrative Assistance in Tax Matters and 17 have committed to implement the common reporting standards. Progress has also been made in enabling the effective implementation even though more work is required.