A New Approach to International Tax Cooperation
The African Group at the United Nations recently called for the negotiation of an international tax convention to prevent avoidance and boost urgently needed revenues. Latin American countries should likewise support a UN-led process to create more comprehensive and equitable rules that reflect the interests of developing economies.
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BOGOTÁ – As one of the world’s most unequal regions, Latin America is desperately in need of additional revenues if it is to solve its knotty economic, social, and environmental problems. But tax collection in Latin American and Caribbean (LAC) countries is low, averaging 21.7% of GDP in 2021, compared to 34.1% for OECD members. What accounts for this gap, and what should be done to close it?