2016-TII-INSTANT-ALL-399
06 December 2016   

BRICS expresses worries over erosion of taxbase by aggressive tax practices

By TII News Service

MUMBAI, DEC 06, 2016: THE Heads of Revenue of the BRICS countries - the Federative Republic of Brazil, the Russian Federation, the Republic of India, the People's Republic of China and the Republic of South Africa, held two-day meeting in Mumbai to discuss the potential areas of cooperation and exchanged opinions and views based on their existing commitment to openness, solidarity, equality, mutual understanding, inclusiveness and mutually beneficial cooperation.

The meeting saw discussions amongst BRICS Experts on Tax matters on contemporary and relevant topics such as sharing of best practices in BRICS countries on improving compliance through non-intrusive means, progress and issues arising out of implementation of BEPS action point 13 relating to Country by Country reporting and also the role of United Nations in becoming the voice of developing and emerging economies in setting international tax rules.

The Heads of Revenue also issued a joint communiqué at the end of the meeting that expressed their continued support to all international initiatives towards reaching a globally fair and universally transparent tax system. They reiterated their commitment to actions taken to ensure the fairness of the international tax system particularly towards prevention of base erosion and shifting of profits, exchange of tax information and capacity building of developing countries.

In its official communique, the BRICS expressed its concern over the erosion of tax base by aggressive tax practices including incomplete disclosure of information, and reaffirmed its resolve to work together to address these concerns. It also stated that profits should be taxed in those jurisdictions where the activities deriving those profits are performed and where value is created. The Communique also resolved that its Members would keep exchanging valuable experience and share best practices in combating base erosion and profit shifting.

The BRICS Members also endorsed the global Common Reporting Standard for the Automatic Exchange of Information on a reciprocal basis. It also recognized the importance of the exchange of information between competent authorities in preventing cross-border tax evasion and resolved to exchange information, both on request and on automatic basis and to adopt global standards on tax transparency.

It also stated that effective tackling of issues of the international tax agenda calls for global involvement of as many countries as possible. In this regard it welcomed the Inclusive Framework encouraging deeper engagement of developing countries in the international tax cooperation.

 

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