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Towards a Level Playing Field,
second edition.

Report undertaken by Stikeman Elliott on behalf of the ITIO and STEP.


15 June 2001

ITIO welcomes US restatement of concerns about OECD tax project, still awaits OECD's promised clarifications

The International Tax and Investment Organisation (ITIO) has welcomed comments made on 13 June by John Taylor, US Treasury Under-Secretary for International Affairs, following a meeting of the OECD's Forum on Harmful Tax Practices.

Mr Taylor spelt out the US administration's continuing opposition to telling countries how to run their tax systems. This appears to confirm US unhappiness with the key "non-discrimination" principle underpinning the OECD's so-called "harmful tax competition initiative".

(The other two principles that underpin the OECD project are effective exchange of information and transparency. Mr Taylor spoke in favour of the former.)

Mr Taylor also confirmed that the US administration was looking for a "redirection" of the OECD's plans for action against alleged tax havens.

OECD sources have suggested that US concerns derive from a misunderstanding by the administration of what is meant by "tax harmonisation". Mr Taylor's comments suggest that the misunderstanding is at least as much the OECD's as the US's.

The OECD's Fiscal Affairs Committee is expected to reveal how US concerns are to be accommodated when it meets on 26-27 June.

Lynette Eastmond, Director of the ITIO Secretariat, commented:

"Mr Taylor's comments suggest that the US position remains basically unchanged from Treasury Secretary O'Neill's statement on 10 May. We strongly support the US government's continuing opposition to criminal tax evasion.

"We also welcome the US's ongoing concerns about OECD attempts to dictate other countries' tax systems. It seems the OECD is now beginning to take US concerns seriously.

"Confusion between the US and OECD over what is meant by harmonisation shows the importance of defining matters clearly. Sadly, the OECD has still not given small countries the fundamental clarifications about its initiative which it promised three and a half months ago.

"For example, why won't the OECD spell out how it sees the difference between criminal and civil tax matters?"

"This shows a lack of good faith and makes it harder for small and developing economies to reach agreement with the OECD."

For further information, please contact Ben Coleman in London on Tel: +44 (0) 20 7526 3603, or Tel: +44 (0) 7958 616 444, or Email:

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