Thursday, August 05, 2010

The UN and the International Tax Organization

I just have one simple question with this story... who granted the UN the power to levy taxes?

Yahoo News report
UN panel: New taxes needed for a climate fund (AP)

BONN, Germany – Carbon taxes, add-ons to international air fares and a levy on cross-border money movements are among ways being considered by a panel of the world's leading economists to raise a staggering $100 billion a year to fight climate change....

With a little research I think I've found some interesting information. The following is what was being planned in 2004. I really doubt that they want me publishing this information. I'll try to find out exactly where this actually is as of today when I get a little more time.

International Tax Organization ideas page
World Commission on the Social Dimension of Globalization - Ideas Bank

Global Currency Transaction Tax - Tobin Tax
Problem statement:

On any day an estimated US$1.5 trillion changes hands in foreign exchange markets. In less than a week foreign exchange transactions exceed the annual value of world trade. The majority (95%) of these transactions are short-term: over 40% of currency market transactions are concluded within 3 days and 80% within 7 days. A sudden reversal of capital flows can trigger the collapse of a currency and rebound negatively on financial markets, causing a financial crisis. The economic and social impact of a financial crisis can be devastating.

Proposal summary:
A levy of 0.1-0.5% on international currency transactions would: i) deter short-term speculation, thus stabilizing exchange rates and ii) generate a new source of revenue that could be redistributed as finance for development.

Air Transport Tax
Problem statement:

The air transportation of passengers and cargo is a key source of environmental and noise pollution, with emissions estimated to almost double by 2020. If this sector is allowed to continue with "business as usual", any emission reductions that other sectors might achieve under the Kyoto Protocol will be offset by the increasing emissions from international aviation.

Proposal summary:
Taxing the air transportation of passengers and cargo could reduce environmental and noise pollution. It could reverse the current exemption of international aviation from environmental responsibilities. It could also raise (limited) resources for global public goods.

Cross-Border Capital Tax
Problem statement:

The erratic nature of speculative capital flows can lead to a currency collapse that may reverberate throughout a region and eventually reach global financial markets, causing a financial crisis. A second problem is the evasion of taxes by highly mobile capital.

Proposal summary:
Raising a withholding tax at source on all private capital inflows would: i) mitigate the destabilizing impact of volatile global capital movements on domestic economies and ii) deal with tax evasion connected with cross-border flows from portfolio investments. Withheld taxes would be ¿creditable¿ against domestic tax liabilities.

Global Tax Network
Problem statement:

Globalization places constraints on the ability of national governments to set and raise taxes. Developing countries need to raise the necessary revenues to finance the services, physical and social infrastructure that will enable them to move out of poverty. This requires well-designed tax policies that are translated into clear legislation and are administratively feasible. A number of taxation issues also have international dimensions that require coordination with other tax authorities. These include the taxation of multinational enterprises, the impact of international tax competition and cross-border VAT and excise issues.

Proposal summary:
Staff at the IMF, OECD and World Bank recently proposed international dialogue on taxation to increase cooperation on tax matters among governments and international organizations, share good practices and pursue common objectives in improving the efficient functioning of national tax systems.

International Tax Organization
Problem statement:

Globalization has progressively undermined the territoriality principle on which traditional tax codes are based. The present regime for the taxing of a multinational corporation with operations in several countries relies on complex and in some respects arbitrary conventions. The taxes that one country can impose are often constrained by the tax rates of others. Companies can also use creative legal avenues to avoid paying taxes in "high tax" locations. This includes sales taxes on easily transportable goods and corporate taxes. Countries also compete to attract foreign direct investment by offering lower tax rates and other tax incentives.Tax evasion is easier when capital earns interest in a country other than where the taxpayer resides.

Proposal summary:
The UN High-level Panel on Financing for Development highlighted the potential benefits of establishing an International Tax Organization. This would: i) provide technical assistance, ii) develop international norms for tax policy and administration, iii) maintain surveillance of tax developments, iv) curb the scope for tax avoidance and evasion on income sources that have a transnational element and v) restrain tax competition designed to attract multinationals.

Politically Feasible Regional Tobin Tax
Problem statement:

While it is recognized that the erratic nature of speculative capital flows can lead to the collapse of a currency, demands for a "Tobin Tax" have met with little practical success.

Proposal summary:
A Politically Feasible Regional "Tobin Tax" (PFTT) on foreign exchange transactions would be implemented on a regional basis - firstly in the EU member states plus Switzerland. Objectives of the PFTT are: i) exchange-rate stabilization and ii) fiscal revenue. The revenue raised would accrue and be administered by the regional body that legislates the tax.

Taxes on the resource rents of deep-ocean minerals
Problem statement:

Coordinated action and additional resources are required to respond to global problems, reduce inequalities between nations and achieve rudimentary social objectives. Large common objectives such as those officially adopted in the Millennium Development Goals demand substantial additional resources. These resources are unlikely to be raised through random individual actions such as the modest ODA supplements offered unilaterally by various OECD countries.

Proposal summary:
This proposal recommends a tax on the resource rents of deep-ocean minerals in order to generate additional resources that can be used for social development.

Arms-Trade Taxes
Problem statement:

Coordinated action and additional resources are required to respond to global problems, reduce inequalities between nations and achieve rudimentary social objectives. Large common objectives such as those that the world has officially adopted in the Millennium Development Goals demand extensive additional resources.

Proposal summary:
This proposal recommends taxing the arms trade to generate additional resources for global purposes in order to provide for what are strictly and intrinsically public goods, as well as to achieve objectives considered essential on the grounds of social justice, solidarity and compassion...

So... these are a few of the international taxes that they have been dreaming of since 2004.

Quite a list... wouldn't one say?

xtnyoda, shalomed

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