Tax treaties

OECD Model Tax Convention: a discussion draft on tax treaty issues related to the trading of emissions permits


31 May 2011 -- The OECD Committee on Fiscal Affairs (CFA) invites public comments on its preliminary analysis of the tax treaty issues related to the trading of emissions permits. This analysis addresses the application of the provisions of the OECD Model Tax Convention to the cross-border trading of emissions permits.


The effort to limit emissions related to global warming has led to an increased use and interest in emissions trading programmes as a mechanism to achieve reductions in emissions of carbon dioxide and other greenhouse gases in an economically efficient manner. These emissions trading programmes present both domestic and international tax issues, including tax treaty issues.


The CFA has examined the tax treaty issues related to the cross-border trading of emissions permits. This public discussion draft includes the preliminary conclusions reached on these issues. It discusses the extent to which different Articles of the Model Tax Convention could apply to profits or gains arising from such trading.  The CFA invites interested parties to send their comments on this discussion draft before 30 October 2011.


This discussion draft has been prepared for the purpose of inviting comments from interested parties. It will be reviewed in the light of the comments received. It does not necessarily reflect the final views of the OECD and its member countries.


Comments should be sent electronically (in Word format) to


Unless otherwise requested at the time of submission, comments submitted to the OECD in response to this invitation will be posted on the OECD website.


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