Organisation for Economic Co-operation and Development (OECD)
The OECD grew out of the Organisation for European Economic Cooperation (OEEC), which was established in 1948 to administer the reconstruction of war-torn Europe via the Marshall Plan. After the Plan was concluded, the United States and Canada joined these OEEC members in ratifying the OECD Convention in 1960.
Although the OECD was created to identify common problems amongst nations and promote policies to solve them, the organization has strayed from its original mission in recent years.
Particularly concerning has been its activities lobbying for tax increases around the world, promoting taxes specifically designed to damage American companies. Half of the targets of the digital services tax, for instance, are slated to be American companies accordingto the European Commission.
As Dan Mitchell from the Center for Freedom and Prosperity noted, the OECD “bureaucracy reflexively embraces just about every kind of tax hike, including class-warfare taxes on income, big new energy taxes, business taxes, and money-vacuuming value-added taxesand advocates other big-government policies such as Keynesian spending, green energy, and government-run healthcare(while at the same time as calling for others to pay more tax, OECD Bureaucrats are exempt from paying any income tax)”
To add insult to injury, the OECD is attempting to impose a global taxation frameworkin which factors like sales and property holdings are weighted and taken into account. This formula, which would need to be agreed upon by all participating countries, would mean that simply holding property in a higher-tax jurisdiction would set a company up for higher taxes. Foreign investors with holdings in the US would likely scale back their holdings, lowering property and company values across America.
Officials insist that replacing the current, decentralized model of multination tax collection with a common international system of “formulaic apportionment” (for at least some profits) would lead to more fairness and simplicity. In reality however, this is simply a method of clamping down on international tax competition and forcing more competitive countries to increase their taxes.
This pro-tax, anti-business agenda should be deeply disturbing for all taxpayers no matter which country they are from. But the OECD’s misguided mission extends far beyond a pro-tax, anti-business framework. The organization regularly inserts itself into domestic politics, abandoning any appearance of impartiality.
Not only has the OECD Secretary General called President Trump a racist, their Deputy Secretary General described President Trump as a “lunatic” and compared him to the NAZI Party.Irrespective of one’s views on the US Head of State, such behaviour is inappropriate for a supposedly neutral taxpayer funded organisation.
More disturbingly, the OECD has recommended specific policies to harm the United States. The United States is not a signatory to the OECD’s Common Reporting Standards directive, as it violates fundamental principles of privacy (this highly problematic directive has even further negative consequences in the developing world where violating privacy in terms of property rights can lead to death by criminal gangs in developing countries). As a result of this the OECD is proposing that it be a criminal offence where advice is given for persons to invest in the United States if any consideration is given to this.
Rather than promote misguided schemes to increase taxes and interfere in nations’ domestic politics, the OECD should get back to its original mission of being a forum rather than a prime advocate of centralization.