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Competition Rules At The OECD: Is Tax Competition Fair Or Unfair?

Tax-news.com

14 February 2000

According to the Broad Street Journal, after Barbadian Prime Minister Owen Arthur spoke out at a Miami conference against the OECD's 'Unfair Tax Competition' crusade, he received a letter from Richard C Hammer, Chairman of the OECD's Business and Industry Advisory Committee (BIAC), earlier in February, congratulating him on his speech.

Hammer said that while his organisation is involved in "every step" of the OECD’s transfer pricing guidelines, model income tax treaty and e-commerce work. it was never consulted about the June 1998 tax competition report, which was issued by the OECD's Committee of Fiscal Affairs. Said Mr Hammer: "The business community in the OECD member states is every bit as chagrined and upset with the "Harmful Tax Competition" project as are you and your colleagues from the other Caribbean nations. The BIAC has taken a very confrontational position vis-à-vis the project, and the subject is very much on the front burner at this moment."

The OECD's counter-IOFC broadside seemed out of character at the time - no organisation has been more consistently pro-business and pro-competition over the years. It increasingly seems no coincidence that the OECD's report was issued soon after the EU's comparable paper on harmful tax practices, and there must be a suspicion that the two organisations (or parts of them) colluded. The OECD's reputation has been damaged by the whole affair, and the organisation as a whole is perhaps better represented by the BIAC's view than by the sour grapes of the Committee of Fiscal Affairs.

See the article by Patrick Hoyos, Editor-in-Chief of the Broad Street Journal at http://www.broadstreetjournal.com/html/news_story.cfm?ID=2309&Fin=1

 

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