Both the Monterrey Consensus and the Doha Declaration on Financing for Development stress the need for enhancing international tax cooperation, including through greater coordination of the work of the concerned multilateral institutions. International rules, policies and cooperative arrangements play an important role in ensuring that national Governments have the ability to raise sufficient revenue domestically while still ensuring needed investment.

This is especially true in the context of the ongoing globalization of economic activities. Indeed, rapid advances in technology, transportation and communication have resulted in a large number of multinational enterprises (MNEs), highly mobile capital and global value chains. An increasing volume of international trade, capital flows, service provision and technology transfer takes place across national borders and within a MNE group. The fragmentation of MNE’s value chains, relying on different components, intellectual property and related intangibles of various origins, has made it harder for tax authorities to discern where value is created and makes it easier for companies to shift profits to low- or no-tax jurisdictions. The international rules governing the taxation of cross-border economic activity have not always kept up with these developments. Consequently, the opportunities for taxpayers, both enterprises and individuals, to avoid or evade taxes have increased. Such activities present new challenges for the international tax cooperation.

The third International Conference on Financing for Development has the potential to analyse the current landscape, with all its complexities, help identify priorities for reform and make concrete suggestions for improved international tax cooperation. This session will explore how international organizations can work together in order to facilitate a more development-oriented approach to setting/updating international tax norms, enhancing tax transparency and exchange of information mechanisms and considering how to overcome knowledge and skills gaps that will otherwise constitute barriers to development.