The 32nd session of the UN Committee of Experts on International Cooperation in Tax Matters commenced on 23 March 2026. The Committee discussed the continuing work on aspects of taxation in the extractive industries. The relevant subcommittee presented its planned workstreams for comment and approval.
The first workstream of the subcommittee would aim to issue practical guidance on valuation and value addition for critical minerals. The guidance would cover the characteristics of the extractive process and tax issues arising; administrative aspects; and border issues. The guidance would take into account development challenges for resource-rich countries. The scope of the guidance would include Latin America and Africa, where the supply side of critical minerals is important. The guidance would take note of other ongoing work of the UN tax committee by liaising with other subcommittees on issues such as the environment, the UN Model treaty and indirect taxes.
The analysis would focus on tax risk issues; constraints within the tax administration; valuation frameworks; and transfer pricing considerations. The issues for tax administrations on critical minerals include risk-based analysis; valuation; compliance and audit; the use of country-by-country reporting; and intra-government cooperation, ensuring that there is a whole-of-government approach. The guidance on value addition and border issues would look at custom valuation and tariff classification; the risks involved in extending the fiscal regime to downstream activities; and transfer pricing risk. The guidance would be illustrated by case studies.
The second workstream would monitor tax developments around the energy transition; and would look at carbon pricing developments; energy transition incentives; and transition-related expenditures.
Comments on the workstreams were contributed by members of the tax committee; country representatives; international organisations and civil society observers. The International Tax and Investment Center (ITIC) noted that there is often an issue around VAT refunds on extractive projects. These projects involve high up-front capital expenditure and a long period before income is earned. The issue of whether timely VAT refunds can be obtained on initial expenditure can be crucial for the decision to go ahead with a project in a developing country. Other comments from participants covered problems within tax administrations and transfer pricing issues.
In response to comments from the floor, the co-coordinator noted that developing country tax administrations often lack technical expertise, specialised personnel and resources. There is an issue around retention of trained staff within the tax administration. Another problem to take into account is that suitable comparable transactions may not be available for pricing of critical minerals. There would be coordination with the work of the transfer pricing subcommittee.
The workstreams on the extractive industries were approved by the Tax Committee.
