UN’s Ad Hoc Committee to Draft Terms of Reference for a United Nations Framework Convention on International Tax Cooperation approved a package of guidance for UN Global Tax Convention.

• It aims at establishing a UN Global Tax Treaty for legitimate, fair, stable, inclusive and effective international tax system.
• Developing countries (including India) largely voted in favour of treaty’s terms of reference while industrialized nations such as Australia, Israel, Japan, UK and USA voted against it. 

Objectives of UN Global Tax Convention

• Strengthening international tax cooperation and making it inclusive and effective. 
• Addressing existing tax-related challenges including digitalization and global operations of large Multinational Corporations (MNCs).
• Mobilize domestic resources and use tax policy for sustainable development. 
• Accelerating implementation of Addis Ababa Action Agenda on Financing for Development and 2030 Agenda for SDGs. 

Commitments of UN Global Tax Convention

• Fair allocation of taxing rights including equitable taxation of MNCs.
• Addressing tax-related illicit financial flows, tax evasion and tax avoidance by high-net worth individuals.
• Address taxation of income derived from cross-border services.
• Effective mutual administrative assistance in tax matters and resolution of tax disputes.