UK and International Tax news
OECD Issues Status Report On Automatic Exchange Of Information
Friday 6th December 2019
The OECD has issued a status report on AEOI following the 10th Anniversary Meeting of the Global Forum on Transparency and Exchange of Information for Tax Purposes.
At the recently held Global Forum in Paris, over 500 delegates from 131 member jurisdictions renewed discussions on efforts to advance the tax transparency agenda.
|The OECD has advised that it is ten years since the G20 declared the end of banking secrecy and thousands of bilateral exchange relationships now in place, which have enabled more than 250 000 information exchange requests over the past decade. According to data in the Global Forum’s 10th anniversary report, nearly 100 member jurisdictions automatically exchanged information on 47m financial accounts in 2018, covering total assets of USD 4.9tn. In total, more than EUR 100b in additional tax revenue has been identified since 2009.|
A recent OECD study shows that wider exchange of information driven by the Global Forum is associated with a global reduction in foreign-owned bank deposits in international financial centres by 24% (USD 410bn) between 2008 and 2019. The commencement of AEOI in 2017 and 2018 is associated with an average reduction in IFC bank deposits owned by non-IFC residents of 22%.
Almost all Global Forum members have eliminated bank secrecy for tax purposes, with nearly 70 jurisdictions changing their laws since 2009. Nearly all members either forbid bearer shares, previously a long standing impediment to tax compliance efforts, or ensure that the owners can be identified. Since 2017, members must also ensure transparency of the beneficial owners of legal entities, so these cannot be used to conceal ownership and evade tax.
Tax transparency has been particularly important for developing countries and 85 developing country members have used exchange of information to strengthen their tax collection capacity. The Africa Initiative has helped African members identify over EUR 90m in additional tax revenues in 2018 primarily due to information exchanges and voluntary disclosures. To improve developing countries’ uptake of automatic exchange of financial information, the OECD UNDP Tax Inspectors Without Borders Initiative has launched a pilot project aimed at supporting the effective use of the data.
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