Including clauses on good tax governance in international agreements will promote sustainable development

tax international relations

In recent years there has been considerable interest in the international tax system. Questions have been raised about the fairness of Double Taxation Agreements (DTAs) between developed and developing countries and their impact on tax revenues in developing countries.

At its October plenary session the EESC adopted an opinion on EU development partnerships and the challenge posed by international tax agreements (rapporteur: Alfred Gajdosik, Various Interests, AT; co-rapporteur: Thomas Wagnsonner, Workers, AT). The opinion points out the need to assess the impact of international tax reform efforts on the sustainable development goals (SDGs).

The EESC welcomes the steps taken by the EU and its Members States to address the weaknesses of the international tax system. Taxation policy should, however, play a bigger role in EU development policy. Furthermore, there is a need to include clauses on good tax governance in all relevant agreements between the EU and third countries in order to promote sustainable development.

The EESC supports the idea of private investment fostering development, when such development is in line with the SDGs. Taxation matters go hand in hand with sustainable development objectives, which is why businesses should pay their taxes in the country where they make profits. (sg)