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Financial Transparency Coalition said developing countries would be the main losers of the OECD minimum global tax deal, risking undermining Covid-19 vaccination and recovery effort.

It will benefit developed countries, particularly the US, a key player behind this agreement, it added.

Towfiqul Islam Khan, senior research fellow of the Centre for Policy Dialogue, said the deal was likely to raise tax rates in low tax jurisdictions, which was welcome.

“However, not all industries are included under the deal. The deal will mainly benefit the large OECD economies,” he said.

“It is likely that the generated revenue will mainly be distributed to the headquarter countries and countries in global south may not be adequately benefitted,” he added.

The deal overlooks concerns highlighted by G-24 countries including India, Pakistan and Sri Lanka regarding reallocation of profits.

The over-representation of low tax jurisdictions in the OECD process is indicative of the deeply unambitious threshold of 15 per cent to tackle tax abuse, said Khan.

“If this deal could be negotiated under the United Nations, a better outcome for developing countries may have been possible. It is critical that global tax matters are negotiated under a UN system where all countries can have an equal say,” he said.