CYIL vol. 14 (2023)

PAVLÍNA KRAUSOVÁ CYIL 14 (2023) are actually proposing to introduce a minimum tax which could be an indication of the success of Pillar Two. Still, the implementation of a top-up tax raises questions about who will receive the right to tax, to which jurisdiction will this apply, and whether this undermines the function of the state. 68 Developing countries seem to have struggled to counteract the influence of the OECD, and the UN has not balanced this power sufficiently. The BRICS 69 countries have not been able to organize an alternative to the OECD. Instead, the BRICS have joined the OECD in BEPS through the G20 organization. 70 3.4 Possible Priorities of the Developing Countries If we are to consider possible trade-offs between the legitimacy of the Inclusive Framework and efficiency in global decision-making as leading to a bias towards the interests of the most powerful states, 71 we should focus on the specific areas of concern as raised by the developing states. Among those are the pressure to join the Inclusive Framework, operations of the Inclusive Framework, such as access to agenda setting or process of negotiations, technological capacities of the countries, ways of framing the benefits, and possible closure of alternative pathways in the future. Initially, the BEPS Project was criticized for not prioritizing developing country interests and creating undue costs and burdens for lower-income and developing countries. Yet a large number of such countries have signed on to the BEPS Project by joining the Inclusive Framework. 72 While research suggests that developing countries’ participation in the BEPS Project may be driven by fears of economic and political consequences, 73 some form of economic motivation among states is common, such as requirements to abide by structural adjustments in exchange for loans. 74 Regarding the agenda setting, the OECD Secretariat is generally seen as an authoritative source of knowledge, reinforced by the belief that it represents the best practices of the best states. Its authority is further strengthened by its association with the G20, 75 possibly limiting the role of other actors, such as UN. But the OECD extensively and periodically reaches out to relevant stakeholders, organizing events, calling for and collecting feedback and providing numerous additional materials in a form of open access available to all countries. 76 68 TANDON, S. (2021). Guest Editorial: The Reform of the International Tax System: State of Affairs. Ibid., 309–310, http://www.kluwerlawonline.com/api/Product/CitationPDFURL?file=Journals\TAXI\TAXI2021037.pdf pg. 934. 69 BRICS is a grouping acronym referring to the developing countries of Brazil, Russia, India, South Africa, and China, which are identified as rising economic powers, all of which are also members of the G20. 70 BRAUNER, Y. (2021). Serenity Now! The (Not So) Inclusive Framework and the Multilateral Instrument. Fla. Tax Rev. , 25 , 489, p. 540. 71 FUNG, S. (2017). The Questionable Legitimacy of the OECD/G20 BEPS Project. Erasmus law review , 10 (2), 76. https://doi.org/10.5553/ELR.000085 (Erasmus law review) p. 87. 72 OEI, S.-Y. (2022). World Tax Policy in the World Tax Polity? An Event History Analysis of OECD/G20 BEPS Inclusive Framework Membership. Yale J. Int’l L. , 47 , 199, p. 200. 73 Ibid. pg. 204. 74 EMBLAD, P. (2021). Power and Sovereignty: How Economic-ideological Forces Constrain Sovereignty to Tax. Nordic Journal on Law and Society , 4 (1), 10. https://doi.org/10.36368/njolas.v4i01.206 p. 16. 75 CHRISTENSEN, R. C., & HEARSON, M. (2019). The New Politics of Global Tax Governance: Taking Stock a Decade after the Financial Crisis. Review of International Political Economy , 26 (5), 1068-1088. https://doi.org /10.1080/09692290.2019.1625802 p. 1079. 76 An example for Pillar two on the OECD webpage available on https://www.oecd.org/tax/beps/tax-challenges arising-from-the-digitalisation-of-the-economy-global-anti-base-erosion-model-rules-pillar-two.htm accessed on 10.5.2023.

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