Development Finance International
22 April - IMF Splitting the Riches Tax Conference, Washington
At the Spring Meetings, the IMF organised a conference on “Splitting the Riches” which explored whether and how it would be possible to apply unitary taxation on multinational companies, analysing their accounts globally and country-by-country, and then apportioning the resulting tax revenues among different countries where each company is based using formulas based on value added, employment and other factors.
The overall conclusion of the day was that is potentially desirable and technically feasible to use these methods, especially to combat profit-shifting by multinational enterprises. However, whether they are implemented will depend on the political will of different countries’ tax authorities to cooperate closely – the strongest perspectives being in the EU.
21 April - G20 Consultation with Commonwealth and OIF Members, Washington
DFI assisted OIF and the Government of Madagascar in the annual dialogue between the Government of Argentina, as current President of the G20, and the member states of the Commonwealth and OIF.
Held at the BWI Spring Meetings, the event focused on the theme of “Building a consensus for a sustainable and equitable development”, and discussions focused on three main topics: (i) the future of work and the impact of technological advances on productivity, growth, jobs and inequality; (ii) the mobilisation of domestic resources to reduce the infrastructure deficit; and (iii) the future of food security.
Member-states had the opportunity to discuss the progress of G20 initiatives on key development issues of interest to OIF and Commonwealth countries such as improving the international tax system, trade and investment cooperation, and the fight against climate change.
19 April – Francophone Ministers and Experts Discuss PPPs with BWIs in Washington
In partnership with La Francophonie, DFI helped facilitate the latest meeting of the Network of Finance Ministers from Francophone LICs in Washington on 19th April 2018, in the margins of the Spring Meetings of the IMF and the World Bank.
Chaired by Herilanto Raveloharison, Minister of Economy and Planning of Madagascar, the meeting gathered 15 countries and 5 sub-regional and international organisations and focused discussions on the issue of Public-Private Partnerships (PPPs) with high-level BWI representatives.
Faced with budget constraints to finance the infrastructure they need to speed up their economic growth and ensure their development, the countries expressed the wish to develop these partnerships to mobilise additional financial resources. They are however aware of the complexity of PPPs and the specific skills needed to successfully implement them without jeopardizing their public finances. Ministers would therefore welcome a more appropriate support from international institutions, better suited to their needs.
The IMF and the World Bank emphasised the importance they attach to this dialogue with the Network and their wish to pursue this cooperation. They heard of countries’ PPP-related concerns and priorities and, based on their previous discussions, described the progress achieved in terms of technical assistance to Francophone countries in other action areas of the Network. In addition, Ministers expressed their concerns about continued inconsistency in World Bank Group policies between, on the one hand, assistance to countries to increase tax revenues; and on, the other hand, the tax exemptions routinely demanded for IFC and PPP projects, as well as the encouragement in the Doing Business rankings of reductions in corporate income tax rates. They asked the World Bank once again to review these policies to ensure coherence in its operations.
The meeting was co-chaired by Benin’s Finance and Economy Minister Romuald Wadagni and Louis-Paul Motaze, Minister of Finance of Cameroon and was preceded by the yearly technical meeting of finance experts who discussed PPP issues in more depth to feed in the ministerial discussion. It was followed by meetings between the Madagascar chair and senior officials of the BWIs, to discuss in more detail their progress on scaling up technical assistance to Francophone countries on increasing progressive revenue mobilisation, and on designing and managing PPPs to minimise costs and risks.
18 April – CRI Index Presented at CSO Innovation Fair in Washington
DFI and Oxfam presented the Commitment to Reducing Inequality Index (CRII) at the CSO Innovation Fair on 18 April 2018 in Washington, in the margins of the Spring Meetings of the IMF and the World Bank.
Held for the first time in the World Bank Atrium, the Fair gave CSOs an opportunity to showcase their projects, innovative products, flagship reports, and ground-breaking campaigns that produce improved development outcomes and contribute to a continued dialogue.
More than 150 participants at the Spring Meetings – including delegates from 52 countries, BWI staff and CSO representatives, stopped at the DFI-Oxfam stall and had the opportunity to explore the Index, enquire about the methodology, and discuss the data findings and the policy solutions (social spending, progressive taxation and labour rights) to fight inequality promoted by DFI and Oxfam. The next edition of the CRII is due to be launched at the Annual Meetings of the BWIs in Bali in October.
22 February - Better Tax Systems for Domestic Resource Mobilisation
Governments will generate more domestic revenue if they strengthen and increase the effectiveness of their tax systems. This is what a group of international institutions (IMF, World Bank, OECD and UN) told Governments at the first Global Conference on Taxation and Sustainable Development Goals (SDGs) of the Platform for Collaboration on Tax.
Held on 14-16 February 2018 at the UN Headquarters in New York, the conference highlighted the importance of focusing efforts on domestic resource mobilisation and recognised the challenge it represents for developing countries to finance essential services such as health and infrastructure. It also warned countries of spillovers from their tax policies and encouraged them to support stronger tax systems, while urging them and all stakeholders to collaborate on establishing a fair and efficient system of international taxation, including efforts to fight tax evasion and tax avoidance.
A conference statement summarising the discussions and next steps was issued at the end of the event.
