UN Attacked Over Global Tax Authority Plans

by Mike Godfrey, Tax-News.com, Washington

10 January 2002

Critics of the United Nations' international tax initiatives have expressed fears that this year's International Conference on Financing for Development, set to take place in Mexico this March, could prove to be more of an embarrassment than last year's anti-racism conference in Durban, which collapsed in spectacular fashion.

The controversy, according to reports, centres around the proposed creation of an International Tax Organisation, which would enable nations to collect and disseminate information regarding their tax policies, assist governments in taxing emigrant workers, and compel members to share tax data.

'This is scary,' observed Veronique de Rugy, an analyst for the US-based Cato Institute. 'They're talking about establishing an extra layer of government at the world level. Their goal is an international tax cartel...that would work to keep taxes high.'

However Tim Hall, a spokesman for the United Nations, denies that this is on the agenda for the March meeting. 'This has nothing to do with taxing anybody,' he stated. 'That is specifically what this proposal is not about.' He asserted that the UN meeting in Monterrey will be more concerned with 'strengthened international tax cooperation through enhanced dialogue' than with the establishment of an international tax body.

There are also fears, though, that in light of recent events the US, which would usually be strongly opposed to any lifting of financial privacy, may view any suggestions made regarding information exchange by the United Nations more favourably.

In the final analysis, despite the UN's denials, it is the lack of guarantees which is worrying many low tax countries and privacy advocates. Dan Mitchell, of the Washington-based Heritage Foundation think-tank explains: 'A lot of the work at these things is done well in advance, and I'm not sure there will be any adult supervision here. It's up to the US government to protect its own interests, and not let a bad idea snowball into something much, much bigger.'

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