Implementation of tax transparency initiative delivering concrete and impressive results

cayman island

The Westin Grand Cayman Seven Mile Beach Resort & Spa, Seven Mile Beach, Cayman Islands (Marc Babin, Unsplash)

This article is brought to you in association with OECD.


International efforts to improve transparency via automatic exchange of information on financial accounts are improving tax compliance and delivering concrete results for governments worldwide, according to new data released today by the OECD.

More than 90 jurisdictions participating in a global transparency initiative under the OECD’s Common Reporting Standard (CRS) since 2018 have now exchanged information on 47 million offshore accounts, with a total value of around EUR 4.9 trillion. The Automatic Exchange of Information (AEOI) initiative – activated through 4,500 bilateral relationships – marks the largest exchange of tax information in history, as well as the culmination of more than two decades of international efforts to counter tax evasion.

“The international community has brought about an unprecedented level of transparency in tax matters, which will bring concrete results for government revenues and services in the years to come,” according to OECD Secretary-General Angel Gurria, unveiling the new data prior to a meeting of G20 finance ministers in Fukuoka, Japan. “The transparency initiatives we have designed and implemented through the G20 have uncovered a deep pool of offshore funds that can now be effectively taxed by authorities worldwide. Continuing analysis of cross-border financial activity is already demonstrating the extent that international standards on automatic exchange of information have strengthened tax compliance, and we expect to see even stronger results moving forward,” Mr Gurria said.

Voluntary disclosure of offshore accounts, financial assets and income in the run-up to full implementation of the AEOI initiative resulted in more than EUR 95 billion in additional revenue (tax, interest and penalties) for OECD and G20 countries over the 2009-2019 period. This cumulative amount is up by EUR 2 billion since the last reporting by OECD in November 2018.

Preliminary OECD analysis drawing on a methodology used in previous studies shows the very substantial impact AEOI is having on bank deposits in international financial centres (IFCs). Deposits held by companies or individuals in more than 40 key IFCs increased substantially over the 2000 to 2008 period, reaching a peak of USD 1.6 trillion by mid-2008.

These deposits have fallen by 34% over the past ten years, representing a decline of USD 551 billion, as countries adhered to tighter transparency standards. A large part of that decline is due to the onset of the AEOI initiative, which accounts for about two thirds of the decrease. Specifically, AEOI has led to a decline of 20% to 25% in the bank deposits in IFCs, according to preliminary data. The complete study is expected to be published later this year.

“These impressive results are only the first stock-taking of our collective efforts,” Mr Gurria said. “Even more tax revenue is expected as countries continue to process the information received through data-matching and other investigation tools. We really are moving closer to a world where there is nowhere left to hide.”

Advertising

the sting Milestone

Featured Stings

Can we feed everyone without unleashing disaster? Read on

These campaigners want to give a quarter of the UK back to nature

How to build a more resilient and inclusive global system

Stopping antimicrobial resistance would cost just USD 2 per person a year

Here’s how drone delivery will change the face of global logistics

The Venezuelan exodus to Roraima and its repercussions

Government internet ban leaves parts of Myanmar ‘in a blackout’, UN expert calls for immediate lifting

What makes a good healthcare professional?

The 3 traps when it comes to blockchain and business – and how to avoid them

EU Banks still get subsidies from impoverished citizens

Facebook has built an AI-based tool that fixes the social network when it crashes

Commission presents first reflections on building a strong social Europe for just transitions

If this is Globalization 4.0, what were the other three?

A Sting Exclusive: “China-Africa Cooperation Sets a Fine Example of South-South Cooperation”, by China’s Ambassador to EU

EU/African, Caribbean and Pacific partnership: MEPs list key aims for renewal

Towards the new era of medicine

Fighting against the Public Health System dismantling means guaranteeing assistance to all

Rising number of young people excluded from jobs, education and training

Privatization and public health: a question of Human Rights

Yemen war: UN chief urges good faith as ‘milestone’ talks get underway in Sweden

The Greta effect? Why businesses are more committed to climate action in 2020

Empty stadiums and online streaming: how coronavirus is affecting the media industry

New rules to help consumers join forces to seek compensation

French election: Will France vote for a reformed or no EU?

How women in developing countries can harness e-commerce

Teachers launch a free ebook to help children cope with the pandemic

What would happen if we removed cars from cities?

Netherlands: Budget MEPs back €1.2m in job-search aid for 450 redundant workers

Cities are especially vulnerable to COVID-19. These organizations are leading the urban response.

Protecting farmers and quality products: vote on EU farm policy reform plans

The key takeaways of G7 Summit in Canada

More answers from Facebook ahead of Parliament hearing today

5 ways COVID-19 has disrupted our sleep

Amending Guatemala ‘reconciliation law’ would lead to unjust amnesty, warns Bachelet

This project in India helps people and tigers co-exist peacefully

CHINA UNLIMITED. PEOPLE UNLIMITED. RESTRICTIONS LIMITED

The number of internally displaced people is at a record high. Here’s why

An economist explains how to create a fairer society

The West and Russia accomplished the dismembering and the economic destruction of Ukraine

UN calls for funds to ease ‘deteriorating’ humanitarian situation in Gaza and West Bank

Why nature is the most important stakeholder of the coming decade

Transport Committee pledges to stop empty flights due to COVID-19

Global Report on Food Crises reveals scope of food crises as COVID-19 poses new risks to vulnerable countries

UN health agency identifies 5-year-old Congolese boy as first confirmed case of Ebola in Uganda

UN genocide adviser welcomes historic conviction of former Khmer Rouge leaders

EU approves close to €240 million to strengthen resilience in neighbouring countries hosting Syrian refugees in light of the coronavirus pandemic

EU members commit to build an integrated gas market and finally cut dependency on Russia

The creative technology and its advancements

Stronger partnerships with post-conflict countries needed to ensure ‘path towards durable peace’: UN chief

ECB offers plenty and cheap liquidity to support growth in all Eurozone countries

3 steps to strengthen Europe’s competitiveness in the digital age

Women’s leadership ‘critical’ to future of Niger

How electrification will make the world more inclusive

The world needs a circular economy. Help us make it happen

The climate and COVID-19: a convergence of crises

How blockchain is addressing key problem patterns in the financial services sector

Erdogan’s electoral win on a ‘me or chaos’ dilemma means trouble for everybody

Encouraging progress made in 2018, in ‘zero tolerance’ effort to end sexual exploitation and abuse across UN

From battlefields to boardrooms: 3 steps to building high-morale teams

EU prolongs economic sanctions on Russia by six months

ECB tied in the anti-monetary German ideology

Africa-Europe Alliance: EU boosts pan-African Internet connectivity with €30 million

United States: UN chief ‘deeply saddened’ by deadly California wildfires

We now know how much ice Antarctica has lost in the last 25 years – three trillion tonnes

More Stings?

Advertising

Speak your Mind Here

Fill in your details below or click an icon to log in:

WordPress.com Logo

You are commenting using your WordPress.com account. Log Out /  Change )

Google photo

You are commenting using your Google account. Log Out /  Change )

Twitter picture

You are commenting using your Twitter account. Log Out /  Change )

Facebook photo

You are commenting using your Facebook account. Log Out /  Change )

Connecting to %s