Tax Treaties and Developing Countries, by Veronika Daurer, The Netherlands:
Kluwer Law International, 2014, xx+341 pages, ISBN: 978-90-411-4982-4, hardback, US$ 189.
By Veronika Daurer
Reviewed by Ajay Kumar
Veronica Daurer’s book, an adaptation of her doctoral thesis, explores the relationship between Tax treaties and developing countries. In particular, it examines the importance of tax treaties for developing countries, and the practice of eleven (Burundi, Ethiopia, Kenya, Madagascar, Malawi, Mozambique, Rwanda, Tanzania, Uganda, Zambia and Zimbabwe) Least Developed Countries (LDCs) from Africa in using the United Nations (UN) Model Tax Convention (tends to favour developing countries).
The core of the book’s thesis is concerned with improving the UN Model, and removing the divergences between the UN and the Organisation for Economic Cooperation and Development (OECD) Models (tends to favour capital exporters) conventions; it is hoped that this would lead to lesser disagreements and easier treaty negotiations. But, the ultimate objective of these changes is to enable the source country to collect more revenues. To achieve these objectives, first it is sought to establish the extent to which the said LDCs use the UN Model provisions in their tax treaties. Second, it is suggested that the UN should focus on commonly seen variations incorporated by the LDCs in their treaties, and include those in its Model.