GLoBE: The Potential Costs of Cooperation

51 INTERTAX 638 (2023) pp. 1 – 12

12 Pages Posted: 10 Apr 2024

See all articles by Tsilly Dagan

Tsilly Dagan

University of Oxford, Faculty of Law; Bar Ilan University

Date Written: 2023


This article argues that the fact that the 2021 global tax deal (focusing on Pillar 2) is cooperative is not in itself proof of the deal being beneficial (and certainly not equally beneficial) for all parties. Developing countries particularly may benefit less and possibly even lose from the agreement. The article focuses on two features of cooperation that may tilt the playing field in favor of developed countries: agenda influence and structural incentives to cooperate. Since the OECD had control over both the agenda and the ways in which the game was structured, it is not surprising that the deal served the interests of its members.

Moreover, the mechanism of Pillar 2 encourages participation and discourages future defection. In the current stage of the international tax regime, this is considered a virtue. However, it might also harbor future risks such as lock-in and cartelistic effects that might benefit the leaders of this initiative (the OECD in this case) at the expense of others. Moreover, the current regime grants significant power to those with their hands on the steering wheel. Such power could be used to disadvantage others. In the absence of mechanisms that would curtail the monopolistic power of some countries, other countries risk paying excessive prices to belong in this regime.

Note: “Reprinted from INTERTAX, Volume 51, Issue 10, 2023, pp. 1 – 12, with permission of Kluwer Law International.”

Suggested Citation

Dagan, Tsilly, GLoBE: The Potential Costs of Cooperation ( 2023). 51 INTERTAX 638 (2023) pp. 1 – 12, Available at SSRN:

Tsilly Dagan (Contact Author)

University of Oxford, Faculty of Law ( email )

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Oxford, OX1 3UL
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Bar Ilan University ( email )

Ramat Gan
Ramat Gan, 52900

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