A trend of decreased taxes on businesses and individuals during the pandemic and the subsequent inflationary period is now showing signs of deceleration and reversal, according to a new OECD report. Tax Policy Reforms 2024 describes the tax reforms implemented in 2023 across 90 jurisdictions, including all OECD countries. It also identifies longer-term reform trends, highlighting how governments have used tax policy to respond to consecutive crises, high levels of inflation, and long-term structural challenges. The report outlines the evolving tax policy landscape as governments strive to balance the need ...

The UK has risen in the rankings of a group of wealthy nations to have the joint-second highest economic growth for this year, a think tank has predicted. The economy is now expected to grow by 1.1%, the same rate as Canada and France, but behind the US. The Organisation for Economic Co-operation and Development’s (OECD) previous growth estimate in May had put UK growth at 0.4% for this year. Chancellor Rachel Reeves welcomed the faster growth figures, which will help reinforce the more upbeat tone she sought to strike ...

The global economy is turning the corner as growth remained resilient through the first half of 2024, with declining inflation, though significant risks remain, according to the OECD’s latest Interim Economic Outlook. With robust growth in trade, improvements in real incomes and a more accommodative monetary policy in many economies, the Outlook projects global growth persevering at 3.2% in 2024 and 2025, after 3.1% in 2023. Inflation is projected to be back to central bank targets in most G20 economies by the end of 2025. Headline inflation in the G20 ...

Meeting on the margins of the Summit of the Future at United Nations (UN) headquarters in New York, Deputy Secretary-General of the Organisation for Economic Co-operation and Development (OECD) Ulrik Vestergaard Knudsen and the UN Secretary-General’s Envoy on Technology, Under-Secretary-General Amandeep Singh Gill, announced a new enhanced collaboration between the UN and the OECD on global AI governance. “The speed of AI technology development and the breadth of its impact requires diverse policy ecosystems to work more cohesively. And in real time. I am delighted that the OECD and the ...

The international community took another concrete step today towards ensuring fairer and better international tax arrangements, in particular for developing countries, by further strengthening global minimum taxation with the implementation of the new Pillar Two Subject to Tax Rule. Nine jurisdictions signed a new multilateral treaty that will allow early adopters to swiftly implement the new Pillar Two Subject to Tax Rule. The Pillar Two Subject to Tax Rule (STTR) was agreed on a consensus basis by members of the OECD/G20 Inclusive Framework on BEPS, who also adopted an elective ...

China’s widening trade surplus and the growing US trade deficit since the pandemic have renewed concerns about global imbalances and fueled an intense debate on their causes and consequences. There are increasing worries that China’s external surpluses result from industrial policy measures designed to stimulate exports and support economic growth amid weak domestic demand. Some worry that the resulting overcapacity could lead to a “China shock 2.0”—a surge of exports that would displace workers and hurt industrial activity elsewhere. This trade and industrial policy view of external balances is incomplete ...

In the European Union, income per person, one of the main gauges of living standards, is on average one-third less than in the United States, mostly because of lower productivity—as emphasized by Mario Draghi’s Sept. 9 competitiveness report for the European Commission. But what is the cause of the problem? As we show in the forthcoming Regional Economic Outlook, Europe’s aggregate productivity problem can be traced back to performance differences at the firm level. Among large, leading companies, productivity and innovation have diverged markedly across both sides of the Atlantic. ...

Gross domestic product (GDP) growth in the G20 area remained relatively stable in Q2 2024, with a 0.7% quarter-on-quarter increase according to provisional estimates, slightly down from 0.8% in the previous quarter (Figure 1). China, India, and the United States contributed the most to G20’s economic growth in Q2 2024,1 although Brazil and Saudi Arabia saw the highest growth rates (both at 1.4%). Growth in both China and India slowed (from 1.5% to 0.7% and from 1.7% to 1.3%, respectively). Japan saw a significant recovery, from a 0.6% contraction in ...

Nine European countries protested on Friday against the International Monetary Fund’s plans to resume missions to Russia, saying it would damage the reputation of the Fund to resume dialogue with a country that has invaded another. After Moscow’s all-out invasion of Ukraine in February 2022, the IMF stopped its annual consultations with Russia, which the Washington-based lender of last resort does for all its members. But on Sept 2, the IMF’s Russian executive director Aleksei Mozhin told Reuters the Fund would re-start online consultations on Sept. 16, and continue with ...

The International Monetary Fund said on Thursday it was appropriate for the U.S. Federal Reserve to begin a long-awaited monetary easing cycle at its meeting next week as upside risks to inflation have subsided. IMF spokesperson Julie Kozack told a regular news briefing that the IMF expected the U.S. economy to slow over the rest of the year, and that this would be reflected in its updated World Economic Outlook forecasts in October. She said the IMF expects core U.S. personal consumption expenditures index (PCE) inflation ending 2024 at 2.5% ...

The UK economy is gathering pace after a spell of weak growth in the context of challenging economic conditions around geopolitical tensions, elevated inflation and rising interest rates. A comprehensive reform agenda is needed to sustain the momentum and stimulate medium-term growth, according to the latest OECD Economic Survey of the United Kingdom. The country’s economic outlook is gradually improving. The OECD projects GDP growth at 1.1% in 2024 and 1.2% in 2025, up from 0.1% in 2023. Headline inflation is expected to continue moderating towards target, with energy and ...

The OECD unemployment rate remained unchanged at 5.0% in July 2024 (Figure 1 and Table 1). Compared to June, the unemployment rate was unchanged in July in 16 OECD countries, while declining in 9, and rising in 7. Six OECD countries recorded an unemployment rate below 3.0%. Only Spain recorded a double-digit rate (Figure 2 and Table 1). The number of unemployed persons in the OECD rose slightly to a total of 34.8 million, with the largest rise in Japan and the United States (Table 2). In the European Union ...

The International Monetary Fund said on Tuesday it had reached a preliminary agreement with Ukraine that would give the war-torn country access to about $1.1 billion in financial assistance. The agreement follows what Kyiv said on Tuesday were “difficult” talks and is subject to approval by the fund’s executive board, which the IMF said in a statement is expected to happen in coming weeks. The IMF is a key international lender to Kyiv and its four-year $15.6 billion program is a crucial part of a bigger global economic support package ...

The postpandemic global economy is beset by slower growth, the most persistent inflation in decades, limited progress on sustainability, and high borrowing costs weighing on investment, including the massive investments needed for the energy transition. Perhaps the strongest headwind, though, is sluggish productivity growth since the global financial crisis. AI is our best chance at relaxing the supply-side constraints that have contributed to slowing growth, new inflationary pressures, rising costs of capital, fiscal distress and declining fiscal space, and challenges in meeting sustainability goals. And the reason is that AI ...

The postpandemic global economy is beset by slower growth, the most persistent inflation in decades, limited progress on sustainability, and high borrowing costs weighing on investment, including the massive investments needed for the energy transition. Perhaps the strongest headwind, though, is sluggish productivity growth since the global financial crisis. AI is our best chance at relaxing the supply-side constraints that have contributed to slowing growth, new inflationary pressures, rising costs of capital, fiscal distress and declining fiscal space, and challenges in meeting sustainability goals. And the reason is that AI ...