THE OECD Committee on Fiscal Affairs (CFA) has invited 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.