New Senate Bill Attacks International Tax Proposals

by Mike Godfrey, Tax-News.com, Washington

18 July 2006

US Senators James Inhofe (R-OK) and Ben Nelson (D-NE) have introduced a bi-partisan bill to stop the United Nations, the OECD and other international organizations from taxing US citizens and corporations or otherwise interfering with American tax policy.

The bill, entitled the Protection Against United Nations Taxation Act of 2006 (S. 3633) has 32 original co-sponsors and would withhold 20% of the United States subsidy to the UN, the OECD and other international organizations if they develop, advocate, endorse, promote, or publicize any proposal "concerning the imposition of a tax or fee on any United States national or any income earned in the United States in order to raise revenue for the United Nations, any foreign government, or any international organization."

At the end of June, the House of Representatives passed an appropriations bill which included similar wording. The 'Fiscal Year 2007 Foreign Operations, Export Financing And Related Programs Appropriations Bill', HR 5522, is one of a number of appropriations (spending) bills making their way through the Congress as implementation of next year's budget continues, and may not survive in its present form. The bill also applies only for the budget year in question.

Says Congressman Ron Paul, (Rep. - Texas), whose wording found its way into the bill: 'Fortunately, the House of Representatives last week passed my language in the 2007 Foreign Operations bill. But that only protects us for another year. Given the stated goals of the UN, it would be foolish to believe the idea of a global tax will go away.'

Several members of the Coalition for Tax Competition hailed the Senate bill. Andrew Quinlan, president of the Center for Freedom and Prosperity said, "Senators Inhofe and Nelson deserve our appreciation and praise for their leadership. The legislation is especially timely since the UN is pushing global tax schemes and the OECD is trying to re-energize its decade-old tax harmonization agenda."

Grover Norquist, President, Americans for Tax Reform, said: "Americans for Tax Reform strongly supports Senators Inhofe's and Nelson's bill to stop the UN and the OECD from interfering with American tax policy or imposing taxes on Americans. International bureaucracies should not be using American tax dollars to pursue statist French tax policies."

Andrew Moylan, Government Affairs Manager, National Taxpayers Union, said: "Americans should not be forced to pay a global tax to a non-sovereign entity. With the federal government set to take $2.4 trillion in taxes out of the economy next year, American families can ill afford to pay an additional tax to an international organization that has proven itself a poor steward of their tax dollars in the past."

Veronique de Rugy of the American Enterprise Institute said: "Global taxation and tax harmonization are tools for high-tax nations to resist economic liberalization. If successful, these efforts would harm global economic growth. Tax competition has led to a 23 percentage point reduction in personal income tax rates since 1980 and a 19 percentage point reduction in corporate income tax rates over the same period."

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