G20 countries pledge to cooperate on taxing the ‘super-rich’

by Bernardo Caram and Marcela Ayres

RIO DE JANEIRO (Reuters) – Finance ministers and central bankers from the Group of 20 nations pledged to cooperate to ensure the world’s wealthiest people are taxed effectively, in their first joint statement released on Friday.

“We will seek to cooperate to ensure that individuals with very high net worth are taxed effectively,” said the final draft statement seen by Reuters.

However, fault lines have already emerged over whether this cooperation should take place in discussions at the United Nations or through the Organisation for Economic Co-operation and Development (OECD).

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U.S. Treasury Secretary Janet Yellen told Reuters on the sidelines of the G20 meetings that she believed the OECD was the organisation best placed to lead such discussions.

“We don’t want to see this happen at the UN,” she said, adding that the OECD was “a consensus-based organisation. We’ve made huge progress, and the UN doesn’t have the technical expertise to (deal with) this.”

Guilherme Mello, an official at Brazil’s finance ministry, said the U.N. framework convention on international tax cooperation was a victory for southern countries, many of which are not members of the OECD.

He acknowledged, however, that both the UN and the OECD were legitimate forums and that discussions on how to effectively tax the “super-rich” continued.

(with David Lawder and Jan Strupczewsk; French version by Camille Raynaud)