02 Dec 2019
Last week, the Global Forum on Transparency and Exchange of Information for Tax Purposes convened in Paris to discuss international efforts to advance tax transparency.
Comprising 158 member jurisdictions, the Global Forum is an OECD initiative that works to address the risks to tax compliance posed by non-cooperative jurisdictions.
“Ten years since the G20 declared the end of banking secrecy, the international community has achieved unprecedented success in using new transparency standards to fight offshore tax evasion,” the OECD said in a statement ahead of the plenary meeting.
The shift is credited to the thousands of bilateral exchange relationships now in place, which have enabled more than 250,000 information exchange requests over the past decade, and more than EUR 102 billion (USD 112 million) in additional tax revenue identified over the same period.
According to the Global Forum’s 10th anniversary report, 2018 saw nearly 90 member jurisdictions automatically exchange information on 47 million financial accounts, covering total assets of USD 4.9 trillion.
For 2019, 94 jurisdictions will exchange financial account information under AEOI, providing the basis for around 6,100 automatic exchanges, an increase of 36% compared to the previous year.
The 2019 AEOI Implementation Report, available here, sets out the details of the status of all jurisdictions implementing the AEOI Standard (the Standard for Automatic Exchange of Financial Account Information in Tax Matters).
“Thanks to international cooperation, tax authorities now have access to a huge trove of information that was previously beyond reach,” said OECD Secretary-General Angel Gurría. “Tax authorities are talking to each other and taxpayers are starting to understand that there’s nowhere left to hide. The benefits to the tax system’s fairness are enormous.”
Besides efforts to end bank secrecy, almost all members now either forbid bearer shares or ensure that their owners can be identified, the OECD said. In addition, almost all members ensure transparency of the beneficial owners of legal entities so they cannot be used to conceal ownership and evade tax.
However, Global Forum participants also stressed that the work is not yet finished, calling for further advancements in tax transparency in the years ahead. Some of the proposed initiatives include exploring the use of tax information to tackle illicit financial flows, virtual assets, and cross-border assistance in tax recovery.
Read more at Regulation Asia
RiskScreen: Eliminating Financial Crime with Smart Technology
Count this content towards your CPD minutes, by signing up to our CPD WalletFREE CPD Wallet