United Nations:

Status of Alternative Revenue Raising Proposals

NSIAD-97-31: Published: Nov 8, 1996. Publicly Released: Nov 8, 1996.

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Pursuant to a congressional request, GAO reviewed the United Nations' ability to raise revenues outside of member assessments, focusing on: (1) whether U.N. organizations receive substantial contributions from private sources; (2) whether the United Nations has authority to implement revenue-raising options, including the imposition of taxes or fees within the jurisdictions of member states, and how the proposals would be processed in the U.N. system; (3) the U.S. position on U.N. authority to impose taxes within the jurisdictions of member states; and (4) U.N. proposals for raising revenues and the status of these proposals.

GAO found that: (1) the United Nations receives only a small part of its financial support from private sources; (2) U.N. operations are funded primarily from three sources: (a) regular budget assessments; (b) special assessments for peacekeeping missions; and (c) voluntary contributions funded by member governments; (3) the United Nations receives some funding through contributions from nongovernmental entities, such as foundations or other private international organizations; (4) of the $5.9 billion voluntary contributions received in 1995, only $584 million came from nongovernmental sources; (5) the United Nations also generates income from commercial sales of products such as U.N. publications or from gift shop operations and fees for services; (6) the United Nations has on two occasions borrowed funds from member states; (7) because the United Nations is an organization of sovereign states with no independent power of its own, it has no authority to impose taxes within the jurisdictions of its member states; (8) granting such authority would, at a minimum, require an amendment to the U.N. Charter; (9) an amendment requires approval and ratification in accordance with the respective constitutional processes by two-thirds of the members of the General Assembly, including all permanent members of the Security Council; (10) the official position of the U.S. government is that it would veto any proposal to amend the U.N. Charter for this purpose; (11) in early 1996, the United States and 77 other countries said that they would consider only voluntary funding approaches for the United Nations; (12) alternative revenue-raising ideas have been solicited within the U.N. system; however, no formal proposals have been made; (14) some U.N. member states, under the auspices of the Economic and Social Council, have studied various financing mechanisms, some of which involve the imposition of taxes within the jurisdictions of the U.N. member states; (14) the financing mechanisms studied include levies on international air and maritime transport, telecommunications, trade, and international currency transactions; and (15) the United States has encouraged delegations to the United Nations to discuss alternative funding sources; however, it has opposed any suggestion that the United Nations be granted authority to impose taxes.

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