INTERNATIONAL efforts to combat tax evasion and
avoidance got a boost yesterday as additional countries and jurisdictions
agreed to join more than 60 other countries in tax co-operation through
a key multilateral tax instrument during the first day of a global meeting
in Jakarta, Indonesia.
Liechtenstein and San Marino became the 62nd and 63rd signatories of the Multilateral
Convention on Mutual Administrative Assistance in Tax Matters at a ceremony
marking the first day of the 21-22 November meeting of the Global Forum on
Transparency and Exchange of Information for Tax Purposes.
A key topic of discussion is the move by tax authorities worldwide from bilateral
to multilateral co-operation and from exchange of information on request to
automatic exchange of information. The Convention provides a comprehensive
multilateral framework for such co-operation and complements other initiatives,
such as the standardised multilateral automatic exchange model being developed
by the OECD and its G20 partners. This Convention is seen as the ideal instrument
to swiftly implement automatic exchange, and to do so with a wide range of
partners.
The Convention also provides for spontaneous exchange of information, simultaneous
tax examinations and assistance in tax collection. A valuable tool for governments
to fight offshore tax evasion, the Convention also ensures compliance with
national tax laws and respects the rights of taxpayers by protecting the confidentiality
of the information exchanged. Tax co-operation and compliance are of crucial
importance for all countries and citizens - and not only in times of a tight
fiscal and budgetary environment.
Canada, New Zealand, the Slovak Republic and South Africa deposited instruments
of ratification, while the Philippines and the Seychelles signed letters of
intention to sign the Convention.
Another important development is the deposit by the United Kingdom of declarations
extending the territorial scope of the Convention to cover the following jurisdictions:
Isle of Man (Crown Dependency) and Anguilla, Bermuda, British Virgin Islands,
Cayman Islands, Gibraltar, Montserrat, and Turks & Caicos (Overseas Territories).
Participants in the Global Forum noted that support for the Convention’s central
transparency and information exchange objectives is increasing rapidly, while
the number of jurisdictions that have signed or are covered by the Convention
has almost doubled since the Fifth Global Forum meeting in October 2012 in
Cape Town.
At present, 63 countries have signed the Convention, four have signed letters
of intention to sign and 13 jurisdictions are now covered by way of territorial
extension. This includes recent signatories Andorra, Hungary, Switzerland and
Chile, as well as Monaco, which signed a letter of intention to sign the Convention
earlier this month. Thirty six signatory countries have now deposited their
instruments of ratification.
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