Conference Underscores Role of OECD on International Tax Issues

Washington, D.C., June 6, 2006 – Over 200 executives, attorneys, government officials, and representatives of the Organization for Economic Cooperation and Development wrapped up a two-day conference here today that highlighted the increasingly influential work of the Paris-based OECD in international taxation policy.

In a keynote address yesterday, Senator Orrin G. Hatch of Utah, the ranking Republican on the Senate Finance Committee, said discussions of tax policy in forums like the OECD can be beneficial for American competitiveness, especially in light of the political difficulties surrounding tax reform in the U.S.

Senator Orrin Hatch was a keynote speaker at the conference.

“In a welcome trend, worldwide corporate tax rates have been gradually falling over the past two decades,” stated Senator Hatch. “Unfortunately, over that period our own corporate tax rate has gone from being somewhat competitive to the highest on the list. A continuing trend among our trading partners toward lower corporate tax rates may be what we need to develop the political will to address this, at least if this force is coming from other OECD countries.”

The OECD, its Business and Industry Advisory Committee (BIAC) and the United States Council for International Business (USCIB) organized the conference in association with several other groups.

The 30-nation OECD seeks to promote growth through coordination of economic and regulatory policies between its members, all of which are democratic market economies. BIAC represents the major industry and employers' organizations in the 30 OECD member countries, bringing their views to bear on the OECD's policy-making process. New York-based USCIB serves as BIAC’s affiliate, and is a leading industry voice on international business and economic matters in its own right.

L-R: Patrick Ellingsworth (Shell), chair of BIAC’s Tax Committee; BIAC Chairman Charles Heeter (Deloitte & Touche); Sen. Hatch; U.S. Ambassador Constance Morella, Jeffrey Owens (OECD).

The conference provided an opportunity for U.S. executives, attorneys and tax professionals to hear directly with key representatives from the OECD’s Center for Tax Policy and Administration. These included Jeffrey Owens, the center’s director, and Mary Bennett, head of its division covering tax treaties and transfer pricing. Also on the program were U.S. Ambassador to the OECD Constance Morella, Hal Hicks, international tax counsel at the U.S. Department of the Treasury, and senior tax officials from the U.S. and other OECD countries.

“The U.S. government plays a leading role at the OECD in hammering out international tax rules,” said Ambassador Morella. “Without clear transparent rules, businesses often finds themselves whipsawed by uncertainty, intractable disputes and double taxation.”

Panelists at the conference addressed such major international tax issues as attribution of profits to a permanent establishment, the OECD’s transfer pricing guidelines, business restructurings and taxation of cross-border services. “The transfer pricing guidelines represent a monumental achievement which has great significance to the U.S. business community,” said Richard M. Hammer, USCIB’s international tax counsel.

Senator Hatch also welcomed the OECD’s work to rein in tax havens that can serve as conduits for money-laundering and other criminal activity. “Tax competition driven by the presence of tax havens … creates an unhealthy situation, and I support attempts to curb their presence,” he stated.

Industry participants called the event a success. “Through this annual conference and USCIB’s extensive ongoing work program on international tax policies, American companies are directly engaged with the OECD and its important work,” said Michael P. Reilly, vice president for taxation with Johnson & Johnson and chair of USCIB’s Taxation Committee.”

Supporting sponsors of the event include the International Fiscal Association-USA Branch, the National Foreign Trade Council and the Organization for International Investment.

USCIB promotes an open system of global commerce in which business can flourish and contribute to economic growth, human welfare and protection of the environment. Its membership includes some 300 U.S. companies, professional service firms and associations whose combined annual revenues exceed $3 trillion. As American affiliate of the leading international business and employers organizations, USCIB provides business views to policy makers and regulatory authorities worldwide and works to facilitate international trade.

Contact:

Jonathan Huneke, USCIB

(212) 703-5043 or jhuneke@uscib.org

Vanessa Vallée, BIAC

(011-33-1) 42.30.09.60 or vallee@biac.org

More on the OECD tax forum (including links to presentations)

More on USCIB’s Taxation Committee

BIAC website

OECD website