The United Nations Development Programme (UNDP), through its Tax for SDGs Initiative, and the South Centre jointly organised a three-day capacity-building workshop in Bogota, Colombia from 7-9 November 2023 on the Basics of International Taxation, Digital Taxation and Minimum Taxation for 56 government officials from the Colombian Finance Ministry, the Colombian National Tax Administration and the Members of the Platform for Taxation in Latin America and the Caribbean (PTLAC), comprising the host, Colombia, and other Latin American and Caribbean countries, viz, Ecuador, Peru, Brazil, Barbados, and the Dominican Republic.

The UNDP and the South Centre are committed to supporting developing countries in raising tax revenues to achieve the Sustainable Development Goals (SDGs). The UNDP, through the Tax for SDGs Initiative, has been working across the globe to implement these activities with the Country Offices in the lead.

The workshop benefited from the presence of Maria Fernanda Valdes, Deputy Finance Minister of Colombia, who provided the following opening remarks:

a) Colombia is now a member of the South Centre; this allows Colombia to work in tandem with other countries of the South on international taxation.

b) Colombia, presently, is holding the Presidency of the PTLAC that is committed to knowledge sharing as one of its fundamentals, which is being met with this workshop.

c) The principle of knowledge sharing is evident from the fact that the workshop is targeted not only at the officers of the Colombian tax administration known as DIAN (Spanish acronym) but also includes officers of tax administrations of other countries of Latin America and the Caribbean.

The purpose of the three-day workshop was threefold:

• Firstly, to provide participants with a general overview of international taxation. This focussed on double tax avoidance agreements and the critical role played by a tax treaty policy framework and a domestic Model Tax Treaty in helping a country negotiate treaties in the national interest. The workshop also provided an overview of transfer pricing to make participants aware of the perils of profit shifting.
• Secondly, to provide an overview of the key negotiations in international taxation today, namely on the taxation of the digital economy, simplification of transfer pricing and minimum taxation. Emphasis was on the Two Pillar solution in the Organisation for Economic Co-operation and Development (OECD) Inclusive Framework and policy solutions already developed and under development in the United Nations (UN). The recent establishment of the PTLAC provides a great new forum to coordinate and amplify Latin America and the Caribbean’s (LAC) voice in international tax negotiations.
• Thirdly, to provide an overview in respect of the adoption of unilateral national measures in the form of Digital Services Taxes (DSTs) and the concept of Significant Economic Presence (SEP). Also, participants were made aware of the potential revenue estimates from policy options under Amount A of Pillar 1 of OECD’s Inclusive Framework, Digital Services Taxes and Article 12B of the UN Tax Treaty Model.

The workshop’s agenda extended beyond theoretical knowledge, delving into the practical aspects of international taxation. Participants were introduced to the art of crafting country-specific tax treaty policy frameworks by a Member of the UN Tax Committee, Mr. Jose Troya of Ecuador. These frameworks are essential to tailor international tax agreements to each nation’s unique context, aligning with domestic policy goals and international obligations.

The bulk of the technical lectures spread across the three days of the workshop were provided by Mr Abdul Muheet Chowdhary, Senior Programme Officer, South Centre and Mr Kuldeep Sharma, Research Consultant – Tax, South Centre.

By the end of the workshop, participants had a clearer understanding of the essentials of international taxation, which include in particular:

• Basics of Tax Treaties
• Importance of a Tax Treaty Policy Framework
• Importance of a domestic Model Tax Treaty
• Basics of Transfer Pricing
• Basics of the Two Pillar Solution, alternatives in the United Nations context and unilateral/national measures

The participants enthusiastically indulged in the specifically designed format of the workshop which had a substantial impact in enhancing the capacity of officials and succeeded in its overall objectives. This is evident from the feedback provided by the participants in pre-workshop and post-workshop surveys.

The workshop concluded with profuse appreciation for the UNDP and South Centre’s support. Going forward, the UNDP and the South Centre will continue to provide support to developing countries to mobilize taxes to achieve the Sustainable Development Goals.