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8 Yale J.L. & Tech. 136 (2005-2006)
The Rise of the OECD as Informal World Tax Organization through National Responses to E-Commerce Tax Challenges

handle is hein.journals/yjolt8 and id is 136 raw text is: THE RISE OF THE OECD AS INFORMAL 'WORLD TAX ORGANIZATION' THROUGH NATIONAL RESPONSES TO E-COMMERCE TAX CHALLENGES ARTHUR J. COCKFIELD* ABSTRACT This paper assesses national and international responses to tax challenges presented by cross-border electronic commerce. Ten years after these challenges were first identified, a survey of national government reactions shows that many countries have not passed any significant tax legislation or administrative guidance with respect to the taxation of global e-commerce. This lack of action at the national level can be explained in large part by the leadership role taken by the Organization for Economic Cooperation and Development (OECD) in developing the guiding principles and, subsequently, the tax rules to confront the e-commerce tax challenges. The OECD's general success with e-commerce tax reform demonstrates the OECD's ability to act as a kind of informal (lower case) world tax organization, which emphasizes deliberation, consensus-building and the use of non-binding mechanisms such as the OECD model tax treaty. Moreover, the OECD's success suggests that calls for a more formal (upper-case) World Tax Organization, which could impose binding tax rules on participating nations, may be misplaced *Associate Professor, Queen's University Faculty of Law. The research for this paper was supported by a grant from the American Tax Policy Institute. A complete version of this paper was first presented as part of the Symposium on the Contemporary Relevance of Sovereignty as well as a Center for Law, Business and Economic seminar at the University of Texas School of Law on April 15, 2005. Drafts of this paper have also been presented at seminars and conferences at Tsinghua University, the China University of Political Science and Law, the University of Toronto, Queen's University, as well as an American Tax Policy Institute roundtable in Washington, D.C.. The author is grateful for comments he received at these fora. The author would like to thank Walter Hellerstein, Charles McLure, Jr., Daniel Mitchell, Alex Easson, Amin Mawani, Ronald Mann, Stephen Shay, Ben Alarie, Larissa Katz, Ken Anderson, Cherie Metcalfe, Robert Wolfe, David Rutenberg and Yoshiro Masui for comments on earlier drafts.