Explanation of Position on a Second Committee Resolution on the Promotion of Inclusive and Effective International Tax Cooperation

Rose Marks
U.S. Adviser to the Second Committee
New York, New York
November 23, 2022


The United States sincerely thanks the facilitator for his crucial role in bringing this resolution to consensus. We wish to clarify our position on critical issues related to this resolution.

The United States strongly supports the political commitment made by 137 jurisdictions little more than a year ago to reform the international tax architecture and stabilize the international tax system using a two-pillar approach spearheaded by the OECD and outlined in detail in the Statement on a Two-Pillar Solution to Address the Tax Challenges Arising from the Digitalization of the Economy on October 8, 2021. We firmly believe that approach will, if implemented, make the international tax system both fairer and better fit for the 21st century economy. We also reaffirm our 2015 commitment to the Addis Ababa Action Agenda of the Third International Conference on Financing for Development.

The October 2021 OECD/G20 Inclusive Framework’s Two-Pillar Solution for resolving the key outstanding questions on international taxation is a once-in-a-generation accomplishment for economic diplomacy. If implemented, it will end the race to the bottom on corporate tax rates and inbound investment incentives being offered by developing countries, level the playing field for business, and improve fairness for workers around the world.

The Two-Pillar Solution on which consensus was reached in October 2021 by 137 jurisdictions collectively representing almost 95 percent of global GDP followed years of detailed and intensive work and negotiations. Those negotiations occurred in an inclusive setting in which jurisdictions around the world provided input. We disagree with the notion implied by this resolution that there is not presently a highly inclusive forum working to strengthen international cooperation on tax.

It is simply not consistent with implementation of the Two-Pillar Solution to decide to begin intergovernmental discussions at the United Nations on ways to strengthen the inclusiveness and effectiveness of international tax cooperation through the evaluation of additional options, including the possibility of developing an international tax cooperation framework or instrument that is not the multilateral convention contemplated under Pillar 1 of the Two-Pillar Solution, but instead is developed and agreed upon through a United Nations intergovernmental process. Rather, OP2 proposes a process that will tear down much of the progress that has been made in international tax cooperation since the 2008-2009 financial crisis and will undermine the

Inclusive Framework at the OECD through which so much progress is being made. For that reason, the United States must dissociate itself from OP2.

OP3 similarly undermines our ability to work together constructively to improve international tax cooperation. Calls for a new report by the UNGA Secretary General at this time are inappropriate. Establishing a UN-headquartered, open-ended ad hoc intergovernmental committee to recommend new actions before completion of the implementation of the Two-Pillar Solution will undermine efforts both to stabilize the international tax system and help it become fit for purpose for the 21st century.

Thank you.