Universiteit Leiden

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Research project

a New Model of Global Governance in International Tax Law Making (GLOBTAXGOV).

Assessing the feasibility and legitimacy of the current model of global tax governance and the role of the OECD and EU in international tax law-making.

Duration
2018  -   2022
Contact
Irma Mosquera Valderrama

The ERC funded research project aims to assess the feasibility and legitimacy of the current model of global tax governance, and the role of the OECD and EU in international tax law-making. The role of the EU and OECD is of increasing significance as governments and organizations struggle to tackle artificial profit shifting by multinationals and bid to increase domestic resource mobilization to achieve post-2015 Sustainable Development Goals (SDGs). This therefore necessitates the need for this project to be multi-disciplinary in nature, touching upon themes not only confined to tax law and practices.

Are the EU and OECD legitimate actors to set rules for all countries, irrelevant of their situation and status as either developing or developed? Are the rules that they proscribe enforced in the same manner across different countries in different regions, and how do these new rules fit into a new framework and environment of international global tax governance. This project will seek to research these questions and go further still in order to create a new reference and evaluation framework for global tax governance.

The 2008 economic crisis increased the need for countries and international organizations to find better solutions to tackle tax evasion due to the illicit flow of capital resulting from the use of tax havens and offshore financial centres. As a result, in 2009, the OECD, with the political mandate of the G20, introduced a global standard on exchange of information. This then led to the OECD introducing a global standard on automatic exchange of information. 101 countries have committed to adopt this standard by either 2017 (early adopters) or 2018. These developments have also been followed by the EU in the recent amended EU Administrative Cooperation Directive.

It would seem however that the measures described above have not gone far enough. Increasingly, and particularly since 2013, news media around the world have continued to highlight a growing crisis in many states, namely the steady decrease in contributions to public finances by many high profile multinational companies and high net worth individuals. This decrease has been associated with the ability of sophisticated taxpayers to shift otherwise taxable income and transactions out of the tax base, in a phenomenon that the OECD has recently labelled “Base erosion and profit shifting”, or BEPS. BEPS refers to “tax planning strategies that exploit gaps in the architecture of the international tax system to artificially shift profits to places where there is little or no economic activity or taxation” (OECD 2013).

The research project will set out to answer the question;

What is the role of the OECD and the EU in global tax governance?; and Under what conditions can the model of global tax governance be feasible and legitimate for both developed and developing countries?

This question will be answered in three research objectives.

First Research Objective

To assess the feasibility of global tax governance taking into account the reasons for countries to transplant BEPS and the differences in tax systems and tax cultures

Outputs related to the First Research Objective

1. Organization

NIAS-Lorentzcenter workshop: How countries learn to tax; complexity. Legal transplants and legal culture 25 Feb to 1 March 2019

2. Presentations including

  • BEPS Action 5. IP Preferential Regimes and their implications for developing countries. Montreal, Canada, McGill University, IP & Tax Policy. 19 to 23 February 2019
  • Legal transplants and international tax standards. Third conference of the VVI and Law and Development Research Network: INTERFACES, 19-21 September 2018.

3. Articles and book chapters

  • Output Legitimacy Deficits and the Inclusive Framework of the OECD/G20 Base Erosion and Profit Shifting Initiative, Bulletin for International Taxation 72(3) (article in journal)
  • The Netherlands and BEPS,  in Tax Design and Administration in a Post – BEPS Era: A Study of Key Reform Measures in 18 Countries (eds. K. Sadiq, A. Sawyer and D. Bronwyn McCredie) Fiscal Publications, United Kingdom. January 2019. (chapter book)

Second Research Objective

To assess the (throughput) legitimacy of global tax governance by the OECD and to provide recommendations for the conditions under which this model of global tax governance can exist?

Outputs Related to Second Research Objective

1. Organization

  • Conference “Pathways to Global Tax Governance” Faculty of Global Governance Affairs, 7 November 2018.
  • Workshop “Tax and Development: The link between International Taxation, the Base Erosion Profit Shifting  Project and the 2030 Sustainable Development Agenda” at the United Nations University – Centre Regional Comparative Studies CRIS, Bruges, 14 January 2019.
  • Design and disseminate work carried out in the GLOBTAXGOV at blog GLOBTAXGOV, Twitter Account and LinkedIn group GLOBTAXGOV. Publications

2. Presentations conferences and participation including

Policy makers G20, OECD and the EU

  • Participation in the T20 Task Policy Force on trade, investment and tax cooperation under the G20 Argentine Presidency.
  • Participation as an academic expert  to the Project on Tax Certainty and Clarifying Treaty Interpretation at OECD. First meeting OECD Conference Centre, Paris, 12 September 2018.
  • Presentation “Tax and development” EU Commission Platform for Good Tax Governance 19 December

Tax Administration

  • “Implementation of BEPS Minimum Standards” at the International Taxation Network CIAT at Training Center of the Spanish Agency of International Cooperation and Development 8-11 October 2018

Academia, policy makers and government officials

  • “Tax Competition and Developing countries” at the Conference Pathways to Global Tax Governance, Leiden University, The Hague, the Netherlands.7 November 2018

“Peer review of BEPS Minimum Standards: From Compliance to Contextualization” at the Conference The Challenges and Opportunities of Multilateralism. University of Oxford, Oxford, the United Kingdom. 10-11 December

3. Articles and book chapters

  • with von Haldenwang C., Faccio T., Hentze T., Mättig T., Redonda A., Rigoni G., Schwab J. & Vos R. (2018), Policy brief Tax Competition to be submitted to the G20 Ministers of Finance under the 2018 Argentinian Presidency (. G20 Presidency, Task Force Trade, Investment and International Cooperation, T20 Argentina 2018). Buenos Aires, Argentina: T20 Argentina 2018. (policy brief)
  • With Lesage D. & Lips W. (2018), Tax and Development: The Link between International Taxation, The Base Erosion Profit Shifting Project and The 2030 Sustainable Development Agenda. Working Paper Series / United Nations University Institute on Comparative Regional Integration Studies (UNU-CRIS) no. W-2018/4 (working paper)
  • The Role of National Governments, in Global Tax Governance: How to achieve Fairness for Developing Countries in Who Pays for Canada? Taxes and Fairness (eds. E. Heaman and D. Tough). McGill-Queen’s University Press, Canada. Book chapter (peer-reviewed) (chapter book). Forthcoming 2019

Third Research Objective

To assess the legitimacy of global tax governance by the EU in respect of EU and third (non-EU) countries and to provide recommendations for the conditions under which this model of global tax governance can exist?

Outputs Related to Third Research Objective

1. Presentations at conferences and workshops including

Tax Administration and EU officials

  • “BEPS Action 6. Tax Treaties: Opportunity or source of inequality?” In EU FISCALIS 2020 Programme.  Spill-over effects of Member States’ tax treaties on developing countries.  Podgorica, Montenegro, 15 and 16 March 2018.
  • Tax and development. EU Commission Platform for Good Tax Governance Brussels, Belgium 19 December

2. Articles and book chapters

  • The EU standard of good governance in tax matters for third (non-EU) countries. Intertax (accepted for publication - peer reviewed) (article).  Forthcoming 2019.

Principal Investigator
Dr. Irma Johanna Mosquera Valderrama

PhD Candidates
Adrian Grant
Frederik Heitmüller

PostDocs
(T.B.A.)

  • Prof. Jeanne Pia Mifsud Bonnici. Professor in European Technology Law and Human Rights, University of Groningen, the Netherlands
  • Prof. Eleonora Lozano Rodriguez. Professor of Tax Law and Director of the Ph.D. in Law at the Faculty of Law,  Los Andes University, Bogotá, Colombia
  • Prof. Kerrie Sadiq. Professor of Taxation,  School of Accountancy, QUT Business School, Brisbane, Australia
  • Dr. Bassem Awad, Deputy Director for Intellectual Property & Innovation. Centre for International Governance Innovation, Ontario, Canada.
  • T. Conzelmann, Professor of Political Science, Faculty of Arts and Social Sciences, Maastricht University, The Netherlands

Articles

2019

ERC Publications

  • MOSQUERA VALDERRAMA I.J. The Netherlands and BEPS, in Tax Design and Administration in a Post – BEPS Era: A Study of Key Reform Measures in 18 Countries (eds. K. Sadiq, A. Sawyer and D. Bronwyn McCredie) Fiscal Publications, United Kingdom. January 2019. (chapter book)
  • MOSQUERA VALDERRAMA, I.J. (forthcoming 2019), The EU standard of good governance in tax matters for third (non-EU) countires. Submitted 3 December for publication to Intertax (double blinded-peer review) (article in journal)
  • MOSQUERA VALDERRAMA I.J. (forthcoming 2019), The Role of National Governments, in Global Tax Governance: How to achieve Fairness for Developing Countries in Who Pays for Canada? Taxes and Fairness (eds. E. Heaman and D. Tough). McGill-Queen’s University Press, Canada (book chapter)

2018

ERC Publications

Additional publications

  • KOK R. & MOSQUERA VALDERRAMA  I.J. (2018), The Netherlands. In: Rosenblatt P., Tron M. E. (Eds.) Anti-avoidance measures of general nature and scope – GAAR and other rules. Cahiers de droit fiscal international / Studies on international fiscal law no. 103(a): SDU. 5-22 (book chapter)
  • MOSQUERA VALDERRAMA, I.J., MAZZ, A., SCHOUERI, L.E., QUINONEZ N., WEST C., PISTONE, P & ZIMMER  F. (2018), Tools Used by Countries to Counteract Aggressive Tax Planning in Light of Transparency, Intertax 46(2): 140-155 (double blinded-peer review) (article in journal)

 For further articles please click here.

Presentations

 2019 PRESENTATIONS 

Principal investigator Irma Johanna Mosquera Valderrama

2018 PRESENTATIONS 

Principal investigator Irma Johanna Mosquera Valderrama

PhD Candidates

Reports/Conference papers

2018

ERC GLOBTAXGOV Publications

Additional Publications 

  • MOSQUERA VALDERRAMA I.J., (2018) Food for Thought: The Challenges Arising from the Multilateral Convention to Prevent BEPS – Answers Unknown?. In: Yalti B. (Ed.) Cross-border tax challenges in the 21st century. Istanbul, Turkey: Onikilevha. 105-152.(conference proceedings)

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