Unions and experts dissect global tax reform challenges and opportunities

In March, the Network of Unions for Tax Justice (NUTJ) brought together over 50 trade union leaders, tax experts, and civil society representatives with a strong focus on global tax reform, corporate accountability, and fair revenue distribution. 

Held virtually with participants from around the world, the meeting highlighted labour’s growing role in shaping international tax policy. From shifts in U.S. and EU tax strategies to new research on formulary apportionment and updates on the UN Framework Convention on International Tax Cooperation, the agenda underscored the importance of collective analysis and coordinated advocacy at a critical juncture for global tax justice. 

Tax cooperation under pressure: the U.S. position

Zorka Milin, Senior Policy Advisor at the FACT Coalition, opened the discussion with a deep dive into recent developments in U.S. tax policy. She drew attention to the Executive Order issued by President Donald Trump on his return to office, which declared U.S. commitments to the OECD global tax deal non-binding without congressional approval. 

While largely symbolic, the order signalled a more confrontational stance, particularly as it tasked the U.S. Treasury with investigating whether foreign tax rules unfairly impact U.S. businesses. Milin warned of possible retaliatory measures—including trade actions and punitive tax rates—aimed at countries implementing Digital Services Taxes or the Undertaxed Profits Rule (UTPR). 

Despite these threats, she advises labour to urge countries to hold firm. The global momentum for reform remains strong, even as the U.S. withdraws from the UN Framework Convention process. Milin also spotlighted concerning U.S. domestic trends, including severe budget cuts to the IRS and stalled efforts to close tax loopholes, underscoring the urgent need for international cooperation. 

European perspectives on multilateral tax reform 

Sébastien Laffitte, Assistant Professor at CY Cergy-Paris University and Researcher at the EU Tax Observatory, offered a European perspective on multilateral tax reform and current tensions with the U.S. He highlighted how the UTPR was designed to encourage global implementation of minimum taxation—by allowing countries to tax undertaxed profits when a multinational’s home country fails to do so. 

Laffitte warned that EU discussions about safe harbours for U.S. firms could weaken the system, potentially disadvantaging European companies and undermining trust in the new rules. He also noted growing calls within the EU for simplified corporate tax systems and fewer regulations—a trend he described as “decluttering”—which may limit political appetite for stronger reforms. 

Despite these challenges, Laffitte argued that ambitious international tax policies remain viable even without U.S. participation. He also flagged the rise of subsidy competition as a looming risk, with countries potentially using state aid rather than tax breaks to attract multinationals—raising new concerns for equity, public finances, and labour rights. 

New research strengthens the case for unitary taxation 

Professor Simon Loretz, Senior Economist at the Austrian Institute of Economic Research (WIFO), presented findings from new research commissioned by NUTJ and the Austrian Labour Chamber. The study explores the potential revenue effects of replacing separate accounting with unitary taxation using formulary apportionment. 

While tax havens and financial hubs are projected to lose revenue, most countries would see increased revenues—especially if they close the gap between statutory tax rate and effective tax rate. 

Companies engaged in aggressive tax avoidance would face higher tax bills, while others could benefit from international loss consolidation. Loretz emphasised that tax savings from avoidance are rarely reinvested in wages or productivity, and are instead captured by executives and shareholders. As a result, raising tax liability on these firms would likely have positive effect on sustainable governance. He also noted that any wage effects would primarily affect top earners, and that relocating jobs in response to new apportionment rules is costly and unlikely. 

The final report will be published soon, alongside a summary of the key findings. 

Data tools and strategies for U.N. advocacy 

Daniel Kostzer, Chief Economist at the ITUC, introduced the IMF’s World Revenue Longitudinal Database—a resource that tracks trends in government revenues and highlights tax gaps across different income groups and regions. The data confirms significant under-taxation in many developing countries, particularly in income and wealth taxation, and points to the need for better oversight, enforcement, and progressive reforms. 

Séverine Picard, NUTJ Coordinator, concluded the meeting with a strategic update on the UN Framework Convention on International Tax Cooperation. Now advancing rapidly, negotiations are set to begin in August 2025. Picard outlined the key issues for unions to address in the months ahead, including governance structures, fair allocation of taxing rights, and the risks of dispute settlement mechanisms resembling investor–state arbitration. 

With the UN process now in motion, Picard called for coordinated advocacy across regions—pressuring governments in the Global North to stop blocking progress and supporting unified demands from countries in the Global South. 

Stay connected 

The Network of Unions for Tax Justice continues to bring together trade unions and experts working to reshape global tax policy. Follow the NUTJ LinkedIn page to stay up to date with the latest reports, analysis, and events.