After months of negotiations, countries today overwhelmingly adopted an ambitious framework document for a UN tax convention. The document¹the so-called Terms of Reference, set ambitious parameters and a clear roadmap for the next phase of negotiations, which is due to start next year and will focus on a framework agreement and initial protocols. The agreed parameters provide a solid basis for countries to reform the broken tax system in the biggest way ever.

Sergio Chaparro HernándezDirector of International Policy and Advocacy at the Tax Justice Network, said:

“Our countries will lose nearly $5 trillion to tax havens over the next decade. The countries that have just joined the UN are opening the door to a better future in which we can avert this and finally put an end to rampant tax abuse by multinationals and the super-rich – a door that some OECD countries have tried to close.”²

110 countries voted in favour of the terms of reference, only 8 voted against and 44 countries abstained. The vote is a sign of how much momentum the UN process is gaining. In the last vote in November last year, 48 countries, mainly OECD countries, voted against continuing negotiations. In contrast, today most OECD countries abstained.

The guidelines published and adopted today contain the key elements that civil society organisations that provided evidence and expert opinions in the negotiations believe are necessary to ensure that the final version of the Framework Convention can protect countries’ taxing rights and recoup billions from tax havens. These fundamentals include specific references to corporate tax, taxation of wealthy individuals, tax avoidance and evasion, illicit financial flows, the allocation of taxing rights between countries, as well as alignment with human rights, sustainable development and the necessary responses to environmental problems.³

This is despite concerted efforts by some OECD members – a small club of rich countries and tax havens that has been the de facto global tax regulator for over 60 years – to weaken and block the provisions, including a last-ditch effort to torpedo the terms with anti-deal changes today. The negotiations, which began in February this year, have largely emerged as a global power struggle, with most countries wanting to transfer leadership on global tax rules from the OECD to the UN, but a handful of OECD countries resisting the idea.

The OECD is widely accused of designing a global tax system that causes nearly half a trillion dollars to flow into tax havens every year, with non-member countries suffering the most damage.⁴ The country has also been criticized for failing to implement the tax reform package it has promised for a decade. Independent UN experts believe that this could in any case be “incompatible” with international human rights obligations, including those to combat racism.⁵ The countries that voted against the start of this year’s UN negotiations in 2023 represented only 15 percent of the world’s population, but were responsible for 75 percent of all tax losses that countries incur each year through tax havens.⁶ Some of them tried to weaken the scope of their duties.

Next, the framework agreed today in the Ad Hoc Tax Committee will be presented to the UN General Assembly in late November or early December, where countries will decide on the basis of the agreed framework whether to enter the next and final round of negotiations.

Sergio Chaparro Hernández said:

“We commend countries for their decision today to set ambitious targets for the good of their people, their economies and our planet. For too long, tax havens and corporate lobbyists have exerted too much influence over our global tax rules behind the closed doors of the OECD. Today, governments have taken an important step forward to give their citizens back power over the global tax rules that affect us all. Shifting global tax rules to the UN would finally require them to be decided transparently and democratically, so that governments can be held accountable by their citizens at home and ensure progress on our shared human rights.”

Alex CobhamExecutive Director of the Tax Justice Network, said:

“This is a momentous day. In just a few months of negotiations at the UN, more ambition has been achieved in fixing the global tax system than we have seen in over 60 years from the OECD. For the first time, we have committed to a fair allocation of taxing rights between countries and are committed to ensuring that countries do not undermine human rights around the world through selfish, short-sighted tax policies. This just shows how much better a transparent and democratic process can be in solving our global problems than the opaque deals we all suffer in the rich country club at the OECD. Today, the majority of countries voted to move the world forward to restore the potential for effective direct taxation – including for multinationals and the super-rich. While unanimous agreement on the text at the UN is the ideal scenario today, the overwhelming majority of countries seeking an ambitious agreement must proceed with a public vote if necessary.”

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Notes for editors

1. The final draft of the service description can be found here.
2. Last year, the State of Tax Justice 2023 study reported that countries are expected to lose $4.8 trillion over the next decade to multinational corporations and wealthy individuals who use tax havens to underpay taxes.
3. In its current form, the document provides a solid basis for future negotiations. It contains commitments on the relevant issues of international tax cooperation that should be addressed in a framework agreement: fair allocation of taxing rights, including fair taxation of multinational companies; combating tax evasion and avoidance by high net worth individuals; achieving sustainable development in its three dimensions, economic, social and environmental; effective mutual administrative assistance in tax matters, including on transparency and exchange of information for tax purposes; combating tax-related illicit financial flows, tax avoidance, tax evasion and harmful tax practices; and effective prevention and resolution of tax disputes. It is important that ambition does not wane in the home stretch. The document also contains a clear list of objectives, principles, priority early protocols, structural elements of the Framework Convention, as well as provisions on timeframes and negotiating approaches that will guide the next Ad Hoc Committee in the negotiating phase of this instrument.
4. You can read more about the OECD’s failed handling of global tax policy here.
5. You can read more about the UN experts’ special mission here.
6. Read more about our analysis of the historic UN vote in 2023 to start negotiations on a UN framework convention on taxation here.