A United Nations Ad Hoc Group of “Experts on International Cooperation in Tax Matters” supports the call for a new body covering international tax. At a recent meeting the group discussed the composition and objectives of the new body, with reports indicating that the UN’s Economic and Social Council will examine this at its next substantive session. The report of the ad hoc group’s meeting is expected to be released in February.

The specialists reportedly reached consensus on several other international tax issues including treaty shopping and tax treaty abuse; transfer pricing; tax treatment of cross-border interest and income and capital flight. The group also considered updating the UN double taxation model treaty and the manual for negotiating bilateral tax treaties between developed and developing countries.

Back in October 2003, the UN called for the creation of a global commission on tax policy. At that time the UN warned that tax competition led to countries *”neutralizing each other’s incentives and lowering each government’s tax take”,*and that *”..there are limits to what individual governments can do about tax evasion and tax avoidance.”* Kofi Annan, UN Secretary General, has suggested that the 25-member UN ad hoc group of experts on international tax matters could be upgraded to “an intergovernmental body, in the form of either a committee of governmental experts or a specialized new commission”. Antonio Ocampo, the UN Under Secretary General for Economic and Social Affairs, said that while initiatives already exist such as the OECD’s work to eliminate harmful tax practices, the UN was the only forum for global dialogue on tax matters.

This move supposedly is in response to the perceived failure of other international bodies to effectively crack down on large scale tax evasion by multinational firms. As such, it is proposed that the new agency also will be involved in the development of new anti-evasion initiatives.