1 The 29 member nations of the OECD are Austria, Australia, Belgium, Canada, Czech Republic, Denmark, Finland, France, Germany, Greece, Hungary, Iceland, Ireland, Italy,
Japan, Korea, Luxembourg, Mexico, New Zealand, the Netherlands, Norway, Poland, Portugal, Spain, Sweden, Switzerland, Turkey, the United Kingdom and the United
States.
June 30, 1997
TO: TAX COMMITTEE No. 21-97
INTERNATIONAL COMMITTEE No. 25-97
PENSION COMMITTEE No. 24-97
RE: INSTITUTE PAPER ON INTERNATIONAL TAXATION OF RETIREMENT
SAVINGS
______________________________________________________________________________
The Organization for Economic Cooperation and Development ("OECD")1 develops its
recommendations for promoting economic growth, financial stability and expanded world
trade by, among other things, holding periodic meetings to which international experts are
invited. Next week, the Institute will participate in an OECD meeting on "Institutional
Investors in the New Financial Landscape."
The attached paper, "Selected Issues in International Taxation of Retirement Savings,"
was prepared by the Institute for presentation at the upcoming meeting. The paper observes
that the global shift toward funded retirement plans -- both government sponsored or
mandated plans and employer sponsored occupational-based plans -- will not be successful
unless plan assets are invested effectively, both domestically and internationally. One tax
impediment to the effective international investment of retirement plan assets is the tax
generally imposed on non-domestic retirement plans by the country in which the plan assets
are invested (the "source country"). The paper concludes with the Institute’s proposal that
countries adopt, on a reciprocal basis, source-country exemptions from tax for retirement plan
assets.
We will keep you informed of developments.
Mary S. Podesta Keith D. Lawson
Associate Counsel - International Associate Counsel - Tax
Attachment (in .pdf format)