A new era of global taxes The world is on the cusp of transforming international tax rules, as nations renegotiate aspects of cross-border business, the division of revenue and international coordination. Amid this new dynamic, Union Finance Minister Nirmala Sitharaman has been urging for a more substantial and prominent role for BRICS economies.
Addressing the BRICS Tax Heads Meeting 2026 in New Delhi, Sitharaman said that international tax rules are being renegotiated and redefined through several multilateral channels, including in the International tax cooperation in the form of the proposed UN Framework Convention on International Tax Cooperation.
BRICS Urge More Say in World Tax Policy
Sitharaman emphasized the need for BRICS countries to push for an active role in international tax negotiations. “BRICS economies are unique in that most of them are large developing economies and significant source jurisdictions,” said the Finance Minister.
The Finance Minister mentioned that there are countries among BRICS whose domestic tax capacity has increased several times over the years and their experience should find place in the deliberations to design a global tax system that is strong and resilient, she said.
The decisions follow at a time when governments around the world are reviewing what shape taxation should take in an increasingly interconnected economy. The rise of transnational corporations, e-commerce and cross-border transactions has raised thorny questions about who has the right to tax.
International Tax Rules at a Turning Point
The current negotiations could also impact governments and businesses in the future when engaged in international trade and investment. Modifications to tax regulations are likely to impact the allocation of profits across borders and the jurisdictional rights to tax those profits.
“Any outcome at this time could have an impact on cross-border taxation for years to come, and hence the involvement of the developing economies in crafting the future system is crucial,” said Sitharaman.
In addition, increased cooperation would facilitate tax administrations in the BRICS countries to address shared issues on the taxation of multinational corporations and cross border transactions.
India Proposes Two BRICS Tax Working Groups
One of India’s proposals on tax cooperation in BRICS is for two working groups.
The first group will work on issues like international taxation and transfer pricing; the second group will work on revenue statistics.
Expected to ease discussion between the international taxation and transfer pricing group treaty interpretation and transfer pricing audits, advance pricing arrangements, the transfer pricing-groupexpect is expected to be and mutual agreement procedures.
Transfer pricing has become a topic of concern for developing countries where intra-group transactions involving two or more tax jurisdictions can give rise to complex taxation issues.
In the meantime, the revenue statistics group would try to establish a set of figures that more accurately captures the fiscal and economic context of the BRICS economies.
Why Transfer Pricing Matters for Developing Economies
Transfer pricing is a general term that refers to the pricing of transactions between affiliated companies or other institutional members of a corporate entity. When such a corporate entity has business operations in multiple countries, variance in tax regimes can cause problems for tax authorities.
Sitharaman cited the heavy toll transfer pricing disputes can take on the tax administrations of developing economies.
Increased information exchange and collaboration among the tax authorities of the BRICS nations may enable them to learn from each other’s experiences and work out shared solutions to these problems.
Building Long-Term BRICS Tax Cooperation
The measures taken by India are aimed at establishing a institutional arrangement that outlives its current BRICS chairmanship. This arrangement should persist long after the current year’s agenda of cooperation on taxation has been achieved.
Continuity will also matter when China takes up the BRICS presidency in 2027.
BRICS’ tax initiatives have covered a Tax Collaboration Tool, Tax Knowledge Hub and Cross-Learning Lab, among other things. There are a few additional initiatives at various stages of development – a VAT Modernisation Report and an HR Development Index.
Another forum for cooperation between the tax administrations and support for ease of doing business initiatives in the form of the proposed BRICS Tax Support Network.
How the Global Tax Changes Might Impact Your Business
Changes to international tax rules may affect companies, investors and governments. Multinational companies may have to keep up with future changes in tax compliance, reporting and apportionment of taxable income.
In emerging markets, the negotiations have a deeper fiscal importance as well. An appropriate tax system for developing economies can affect government revenues and taxation of cross-border activity.
As the debate persists across various global platforms, it seems that the contribution of the economies that make up BRICS will continue to be an integral part of the wider debate on international taxation.
India’s recent moves highlighted the priority to promote cooperation among BRICS tax administrations and to achieve fairer participation of developing economies into the new global tax system.
