United Nations

General Assembly

A /AC.295/2024/L.4
Distr.: GeneralXX August 2024
Original: English

Ad Hoc Committee to Draft Terms ofReference for a United Nations Framework
Convention on International Tax Cooperation
Second session
New York, 29 July – 16 August 2024

Chair’s Proposal for Draft Terms of Reference for a
United Nations Framework Convention on International
Tax Cooperation
15 August 2024

I. INTRODUCTION
1. In adopting resolution 78/230, “Promotion of inclusive and effective international
tax cooperation at the United Nations,” the General Assembly emphasized thatdeveloping a United Nations framework convention on international tax cooperationis needed in order to strengthen international tax cooperation and make it fully
inclusive and more effective.
2. The General Assembly recognized in the resolution that developing a framework
convention will also help in accelerating the implementation of the Addis Ababa
Action Agenda on Financing for Development and the 2030 Agenda for Sustainable
Development.
3. Therefore, the General Assembly established a Member State-led, open-ended ad
hoc intergovernmental committee for the purpose of drafting terms of reference for aUnited Nations framework convention on international tax cooperation.
4. The General Assembly further requested that the ad hoc intergovernmental
committee submit a report to the General Assembly at its seventy-ninth session,containing the draft terms of reference for a United Nations framework convention.
5. The ad hoc intergovernmental committee, having completed its work in accordancewith this mandate, now recommends for consideration by the General Assembly thefollowing draft terms of reference for a United Nations framework convention oninternational tax cooperation.

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II. STRUCTURAL ELEMENTS OF THE CONVENTION
Preamble
6. The text of the framework convention should reflect, inter alia, the following
General Assembly resolutions:a.
78/230 of 22 December 2023 on “Promotion of inclusive and effective
international tax cooperation at the United Nations”;
b.
77/244 of 30 December 2022 on “Promotion of inclusive and effective
international tax cooperation at the United Nations”;
c.
70/1 of 25 September 2015 on “Transforming our world: the 2030 Agenda
for Sustainable Development”; andd.
69/313 of 27 July 2015 on the Addis Ababa Action Agenda of the Third
International Conference on Financing for Development.

Objectives
7. A United Nations framework convention on international tax cooperation should
include a clear statement of its objectives. In that regard, it should:a.
Establish fully inclusive and effective international tax cooperation in terms ofsubstance and process;b.
Establish a system of governance for international tax cooperation capable ofresponding to existing and future tax and tax-related challenges on an ongoing basis;c. Establish an inclusive, fair, transparent, efficient, equitable, and effective
international tax system for sustainable development, with a view to enhancing thelegitimacy, certainty, resilience, and fairness of international tax rules, while
addressing challenges to strengthening domestic resource mobilization.

Principles
8. A United Nations framework convention on international tax cooperation should
include a clear statement of the principles that guide the achievement of its
objectives.
9. Efforts to achieve the objectives of the framework convention therefore should:
a. be universal in approach and scope and should fully consider the different needs,priorities, and capacities of all countries, including developing countries, inparticular countries in special situations;b. recognize that every Member State has the sovereign right to decide its taxpolicies and practices, while also respecting the sovereignty of other Member Statesin such matters;c. in the pursuit of international tax cooperation be aligned with States’ obligations
under international human rights law;
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d. take a holistic, sustainable development perspective that covers in a balanced andintegrated manner economic, social and environmental policy aspects;
e. be sufficiently flexible, resilient and agile to ensure equitable and effective results
as societies, technology and business models and the international tax cooperationlandscapes evolve;
f. contribute to achieving sustainable development by ensuring fairness in allocationof taxing rights under the international tax system;g. provide for rules that are as simple and easy to administer as the subject matterallows;h. ensure certainty for taxpayers and governments; andi. require transparency and accountability of all taxpayers.

Commitments
10. The framework convention should include commitments to achieve its objectives.
Commitments on the following subjects, inter alia, should be:a. fair allocation of taxing rights, including equitable taxation of multinationalenterprises;b. addressing tax evasion and avoidance by high-net worth individuals and ensuring
their effective taxation in relevant Member States;c. international tax cooperation approaches that will contribute to the achievementof sustainable development in its three dimensions, economic, social andenvironmental, in a balanced and integrated manner;d. effective mutual administrative assistance in tax matters, including with respect
to transparency and exchange of information for tax purposes;
e. addressing tax-related illicit financial flows, tax avoidance, tax evasion andharmful tax practices; andf. effective prevention and resolution of tax disputes.

Capacity Building
11. Inclusive and effective participation in international tax cooperation requires
procedures that take into account the different needs, priorities and capacities of all
countries to meaningfully contribute to the norm-setting processes, without unduerestrictions, and support them in doing so, including giving them an opportunity toparticipate in agenda-setting, debates and decision-making, either directly or throughcountry groupings, according to their preference.
12. The framework convention therefore should include provisions regarding
institutional mechanisms to support Member States, especially developing countries,
in their efforts to build capacity on relevant international tax practice and related
issues to ensure that they have adequate capacity to participate effectively ininternational tax cooperation and to implement the framework convention.

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Other Elements
13. The framework convention should also include, inter alia, the following additional
substantive and procedural elements: definitions; relationship with other agreements,
instruments and domestic law; review and verification; exchange of information (forimplementation of the framework convention); data collection and analysis; financialresources; Conference of the Parties; Secretariat; subsidiary bodies; dispute settlement
mechanisms; and procedures for amendments to the framework convention andadoption of protocols; and final provisions.

III. PROTOCOLS
14. Protocols are separate legally binding instruments, under the framework
convention, to implement or elaborate the framework convention. Each party to theframework convention should have the option whether or not to become party to a
protocol on any substantive tax issues, either at the time they become party to theframework convention or later.
15. Two early protocols should be developed simultaneously with the framework
convention. One of the early protocols should address taxation of income derived
from the provision of cross-border services in an increasingly digitalized andglobalized economy.
16. The subject of the second early protocol should be decided at the organizationalsession of the intergovernmental negotiating committee and should be drawn from thefollowing specific priority areas:a. taxation of the digitalized economy;b. measures against tax-related illicit financial flows;c. prevention and resolution of tax disputes; andd. addressing tax evasion and avoidance by high-net worth individuals and ensuring
their effective taxation in relevant Member States.
17. Protocols addressing the following topics, inter alia, could be considered:a. tax cooperation on environmental challenges;
b. exchange of information for tax purposes;
c. mutual administrative assistance on tax matters; andd. harmful tax practices.

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IV. APPROACHES AND TIME FRAME FOR
NEGOTIATION
18. The framework convention should be elaborated by a Member State-led
negotiating committee. The intergovernmental negotiating committee would meet in2025, 2026 and 2027 for at least 3 sessions per year, of a duration of no more than 10
working days per session, and complete its work and submit the final text of theframework convention and of the two early protocols to the General Assembly for its
consideration in the first quarter of the eighty-second session.
19. The bureau of the intergovernmental negotiating committee should consist of achair, eighteen vice-chairs and a rapporteur, elected on the basis of equitable
geographical representation.
20. Member States should be fully engaged in the negotiation of the framework
convention and endeavor to ensure continuity in their representation.
21. International organizations, civil society and other relevant stakeholders areencouraged to contribute to the work of the intergovernmental negotiating committee
in accordance with established practices.
22. Throughout its work, the intergovernmental negotiating committee should take
into consideration the work of other relevant forums, potential synergies and theexisting tools, strengths, expertise and complementarities available in the multiple
institutions involved in tax cooperation at the international, regional and local levels.

VI. RESOURCES TO SUPPORT THE WORK OF THE
NEGOTIATING COMMITTEE
23. The Secretary-General should be requested to provide the intergovernmental
negotiating committee with the necessary facilities and resources, including technicalsecretariat from the Department for General Assembly and Conference Management
and substantive secretariat from the Department of Economic and Social Affairs, tosupport its work.
24. Member States and other relevant stakeholders in a position to do so areencouraged to assist in ensuring the full and effective participation of developing
countries, including in particular the least developed countries, in the negotiation of
the framework convention, including by covering travel and local expenses andthrough capacity-building.

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