DESA News Vol. 11, No. 10 October 2007

Trends and analysis

International cooperation in tax matters

Experts to discuss tax evasion and taxation of development projects, among other issues

The twenty-five experts who make up the Committee of Experts on International Cooperation in Tax Matters will meet from 29 October to 2 November in Geneva. Participants will examine issues such as the improper use of tax treaties to avoid taxes, taxation of development projects, exchange of information between tax authorities, and dispute resolution in international taxation. Discussions will feed into an update of the UN Model Tax Convention, on which many bilateral agreements are based.

Committee members will consider ways of combating tax avoidance and evasion through treaty and domestic law provisions. They will discuss the definition of “permanent establishment”, a term that refers to the degree of economic engagement in a country. A designation of permanent establishment generally allows national authorities to tax profits of the established activity, and is especially important where there is trade in services, rather than goods. The assembled experts will also exchange views on whether development projects should be subject to the normal tax rules or granted tax exemptions.

Exchange of information between tax authorities will be stressed as a means of promoting the integrity of tax systems by safeguarding them against evasion and reducing aggressive tax avoidance. The group of experts will also consider the revision of the UN Manual for the Negotiation of Bilateral Tax Treaties, which assists developing countries in bilateral tax treaty negotiations with developed countries. Lastly, the Committee will address the treatment of Islamic financial instruments under tax treaties that are geared to interest bearing instruments, and may not be well-suited to Islamic financial instruments that have no “interest” component.

The Committee of Experts is comprised of individuals nominated by governments and acting in their personal capacity. They are drawn from the fields of tax policy and tax administration, and are selected in consideration of equitable geographical distribution and representation of different tax systems. The members are appointed by the Secretary-General for a term of four years, after notification to the Economic and Social Council to which the Committee reports.

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Measuring violence against women

General Assembly seeks indicators to assess scope, prevalence, and incidence of aggression

Efforts to eliminate violence against women commonly materialize in the form of gender equality policies in different fields. But assessing success or failure of such policies hinges on the availability of reliable data on whether or not violence has increased or decreased as a result of their adoption. The Division for the Advancement of Women and the Statistics Division in DESA, together with ECE, will hold an expert group meeting on indicators of violence against women in response to a General Assembly mandate to propose and develop a set of measures that can be used by countries to assess the scope, prevalence and incidence of such aggression. The meeting will be held in Geneva from 8 to 10 October.

Indicators proposed by a range of governmental and non-governmental actors so far cover areas such as prevalence, severity and impact, risk factors, victim support, public attitudes and perceptions, and measures to combat violence against women. Assessment of current initiatives, and recommendations for further action, will be summed up in a report for consideration by the Commission on the Status of Women and Statistical Commission, both serviced by DESA.

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New financial tools for sustainable development

Innovation in research investment, insurance, and municipal bonds can help overcome the finance gap

Financial tools to encourage innovative sustainable development projects will be in the spotlight in New York on 18 and 19 October. An expert group meeting organized by DESA’s Division for Sustainable Development will pave the way for the 16th session of the Commission on Sustainable Development by discussing the challenges of implementing innovative financial instruments in support of agriculture, desertification, drought, rural development, and Africa. Specific ideas include funds for agricultural research and development, index-based insurance products for agriculture, micro-health insurance in Africa, and sub-national instruments for financing basic utilities.

In recent years, there has been shift in the way agricultural research and development is financed, with fewer public funds available. In Africa, the problem is acute due to scarce and scattered human and financial resources. The first of four sessions at the New York meeting will provide an overview of new methods of financing research such as advanced purchase commitments and cash-prizes.

Agricultural insurance products based on weather indexes will be the subject of the second session. Such products can be an attractive option for farmers in developing countries, especially in those economies based on rain-fed agriculture. The implementation, scope and limits of insurance will be explored along with risk sharing between government and beneficiaries.

Africa’s experience with micro-health insurance and the potential for coverage scale-up will be examined. Sub-Saharan Africa has the world’s highest maternal mortality, with HIV/AIDS, malaria and tuberculosis wrecking havoc on the continent’s population. There is a pressing need for greater involvement of the private sector in healthcare delivery in Africa, and thus the need for sustainable business models. The third session will assess the performance of micro-health insurance initiatives, and consider financial sustainability in light of the ability of consumers and governments to pay.

The last session will deal with long-term financing of utilities. Borrowing has traditionally not been seen as a viable financing option for water and electricity at the local level. Yet the demands placed on municipalities by rapid urbanization, fiscal decentralization, and decreased transfers from central governments are forcing a reconsideration of conventional practices. In this vein, success stories in attracting domestic and international investors to municipal bonds in developing countries will be shared, along with the role of intermediaries and pooled financing arrangements to distribute risk and enhance the credit of local authorities.

The meeting will bring together academics, development institutions, practitioners in the field, and private sector actors. Sha Zukang, Under-Secretary General for Economic and Social Affairs, will deliver introductory remarks.

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Decent work for all

What are the obstacles countries face the quest for full employment and decent work for all? Experts are meeting in New York from 2 to 4 October to examine this question by sharing national and regional experiences on policies that generate more and better jobs. The meeting is organized by the Division for Social Policy and Development in DESA, and will result in a brief summary with specific policy recommendations.

This year, the 45th session of the Commission for Social Development began a two-year review and policy cycle on this theme. Serviced by DESA, the Commission’s policy segment in 2008 is expected to lead to a negotiated outcome with action-oriented policy recommendations, based in part on the findings of the assembled experts in October.

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Innovation and stability in public service

Innovation may appear to be at odds with the predictability and stability that is often associated with – and expected from – public institutions. The Division for Public Administration and Development Management in DESA will participate in a high level panel on innovation in public administration during the Annual Congress of the Latin American Centre of Administration for Development that may well reconcile these two notions.

Efficiency, equity, professional management, developing inclusive policies to fight poverty and encouraging alliances and networks to provide public services are themes that will be explored in the workshop, to be held in Santo Domingo from 30 October to 3 November. Guido Bertucci, Director of DPADM, will sit alongside the Governor of the State of Bahia in Brasil, the Minister of the Presidency of Chile, the Minister of Public Service of Dominican Republic and two high level experts in the area of public administration in Latin America.

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