Tax Avoidance: Base Erosion and Profit Shifting

Lord Collins of Highbury Excerpts

Monday 2nd November 2020 Lords Chamber

[Baroness Penn (Con)]

My noble friend is right. These negotiations are complicated, and they involve more than 100 jurisdictions. Although it is difficult, I welcome the progress that we manage to make. My noble friend is also right about action 14: the peer review process is under way. More than 45 jurisdictions have been reviewed so far and around 990 recommendations issued as a result of that process.

[Lord Collins of Highbury (Lab)]

The noble Lord, Lord Kirkhope, is right: there is no consensus. When we in this country condemn companies that do not pay tax—we even have the digital tax—everyone is supportive, but developing countries are a different kettle of fish. We must win the argument for ensuring that the “taxing country” principle applies to developing countries. Will the Government make sure that supportive measures are taken not only within the OECD but within the United Nations to ensure that developing countries get their fair share of tax?

[Baroness Penn (Con)]

The noble Lord is right that this is not only an issue for developed countries but is essential for developing countries and their tax take. The UK believes that the OECD should be the primary standard-setting body for international tax standards, but we are absolutely committed to ensuring that the voices of developing countries continue to be central to those discussions. This is why we have been keen to build on the progress the OECD has made in integrating the interests of developing countries. The inclusive framework has over 100 non-OECD member states and 66 from less economically developed countries, to ensure that those voices are front and centre of these discussions.