OECD rules won’t save Philippine tax revenues. The UN tax negotiation is our chance to fix the system.
By Lidy Nacpil and Luke Espiritu
The Philippine government took a noteworthy step recently as the Department of Finance (DOF) and Bureau of Internal Revenue (BIR) officially began drafting the legislative and administrative framework to implement the Global Minimum Tax (GMT). Presumably, this move aims to protect local revenues from being shifted overseas by requiring multinational enterprises with annual global revenues of at least €750 million to pay a minimum 15% effective tax rate, a standard set under the OECD/G20 international tax agenda.
Relying on schemes cooked up by the OECD to fix global tax abuse is like putting a band-aid on a gushing wound. The 15% tax rate falls way below current average global rates which in some countries exceed 30 percent. Slashing rates means further depleting national revenues. For years, the OECD minimum global corporate tax has received heavy criticism from many developing countries, tax experts, and civil society as a “tax deal of the rich.”
The OECD framework was built by and for wealthy economies, the very nations that host the world’s biggest corporate conglomerates. Under their rules, developing nations like the Philippines are stuck playing passive rule-takers, left to settle for crumbs while wealth continually drains outward.
If Finance Secretary Frederick Go and his team want to genuinely protect the country’s coffers, the real battleground isn’t in Paris or Washington. It’s in New York.
From August 3 to 13, delegates will gather at the United Nations Headquarters for a high-stakes round of negotiations on the UN Framework Convention on International Tax Cooperation. This isn’t just another dry diplomatic summit. It represents a once-in-a-generation shot at dismantling an unfair architecture and replacing it with a system where every country, regardless of GDP, actually gets an equal say.
Right now, more than US $1 billion is drained globally every single day through corporate tax dodging and offshore tax evasion by multinationals and the ultra-wealthy.
These losses hit hard for the Philippines, a nation grappling with ballooning public debt, underfunded public schools, overwhelmed hospitals, and the escalating costs of climate disasters. Every peso siphoned into a distant tax haven is a rural health clinic left without supplies, a growing backlog of unbuilt classrooms, or subsidy denied to families reeling from the oil and gas crisis.
Global tax policy has been dictated for decades by exclusive clubs like the G7 and the OECD. Unsurprisingly, their rules prioritize corporate headquarters in the Global North over “source countries” in the Global South where the actual labor happens, the natural resources are extracted, and the consumer markets exist.
In November 2023, the Philippines stood alongside 124 other nations in a historic vote to create a democratic tax convention under the UN. Since then, Member States have laid out a clear roadmap to rewrite international tax rules.
Unlike OECD-led talks where power stays concentrated among economic heavyweights, the UN framework operates on a simple, fair principle: one country, one vote.
As Secretary Go and our negotiating team head to New York this August, our delegation must stand shoulder-to-shoulder with the Group of 77 (G77) and the Africa Group. Together, we must champion three critical priorities. One, multinationals must pay their fair share where economic activity actually takes place. The Philippines needs full sovereign authority to tax profits generated within our borders, particularly in fast-growing sectors like digital services and resource extraction. Two, wealth inequality is skyrocketing both at home and abroad. We need global transparency measures to track hidden offshore assets and ensure the super-rich or high net worth individuals contribute proportionally. And three, global tax policy cannot be decoupled from environmental reality. Linking tax rules to the Polluter Pays principle will ensure major corporate polluters help fund climate resilience and a just energy transition for vulnerable nations like ours.
Article VI, Section 28 of the Philippine Constitution calls for a progressive system of taxation. Fulfilling that domestic promise requires fixing the rigged international rules that constantly undercut it.
Drafting domestic minimum tax laws might buy us short-term protection, but real revenue sovereignty requires fixing the system at its root. By taking a firm, principled stand at the UN negotiations this August, the Philippines can help build a global tax regime that is transparent, democratic, and truly fair.
The chance to rewrite the rules is on the table. Secretary Go, it’s time for the Philippines to step up, lead alongside the Global South, and fight for a tax system that puts our people first.
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Lidy Nacpil is the coordinator of Asian Peoples’ Movement on Debt and Development (APMDD).
Luke Espiritu is a labor lawyer and the president of Bukluran ng Manggagawang Pilipino (BMP).
Published by Business Mirror.