Commonwealth finance ministers have recognised the potential of technology to improve debt transparency while urging closer collaboration to resolve tax challenges arising from growing digital commerce.
These decisions were made by ministers gathered in Washington DC for the 2019 Commonwealth Finance Ministers Meeting under the theme ‘preventing debt crises: the role of creditors and debtors’.
Ministers have therefore agreed that the Commonwealth should bring its powerful collective voice to ongoing discussions at the Organisation for Economic Co-operation and Development (OECD), particularly on behalf of smaller states. International agreement on digital taxation could enable countries to benefit by taxing large tech giants, even if they do not operate within their jurisdictions.
Commonwealth Secretary-General Patricia Scotland said: “The Commonwealth has a distinctive contribution to make by bringing together nations with developed and developing economies to agree on collective approaches and action towards a fair and equitable global system for taxing multinational businesses in a swiftly digitalising economy
“We need a rule-based system that is inclusive, transparent and efficient so that all countries have a means of collecting revenue and are thereby able to avoid accumulating excessive debt. It goes hand in hand with accelerating the gains to be made by addressing climate change and making progress towards achieving the sustainable development goals.”
Ministers saw global trade and geopolitical tensions as having ‘intensified’, in a context where global debt has risen to an all-time high, estimated at $19 trillion. They stressed the need to make debt easier to manage for vulnerable countries, and for them to be eligible for periods of relief to stabilise growth during economic shocks.
