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The OECD's 'unified proposal': a view from the Tax Justice Network

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But as it stands, the proposal would make the system significantly more complex, rather than simpler. It would redistribute only a very small share of shifted profits, and the apportionment would be based on sales only, rather than sales and employment, as the G24 proposed. And overall, it is likely to provide little or no benefit to non-OECD members. 

Disappointingly, the OECD has not published so far any quantitative analysis of how the proposals would affect individual tax jurisdictions, or even the extent to which it would shift the MNE tax base away from tax havens. This is not what we expect from a multilateral institution committed to evidence-based policymaking.

Our analysis, co-authored with Tommaso Faccio of Nottingham University Business School and Valpy FitzGerald of Oxford University (see, using aggregate country by country reporting data from US multinationals, suggests that only 5% of profits currently declared in tax havens would be redistributed under a simplified version of the proposal; and that the great bulk of the benefits would go to high income countries. Lower income countries, which rely on corporate tax for a higher proportion of their revenue to fund vital public services but also suffer disproportionately from companies’ abuse of the current rules, would gain little to nothing.

We urgently need the OECD to publish its own assessment, and the full country by country dataset they hold, so everyone can see which countries are likely to benefit from new tax rules. If the proposals exacerbate the existing global inequalities in taxing rights, the reform process may collapse into divergent, unilateral measures – but at least the principle of unitary taxation will have been established as legitimate, for individual governments or blocs to pursue.

Alex Cobham, Tax Justice Network