Thursday 20 November 2014

50 countries sign deal to share your Information


Automatic exchange of information on a global scale will become a reality in 2017, as 51 countries signed an agreement to share financial information. Another 35 jurisdictions will join the following year.

All Organisation for Economic Cooperation and Development (OECD) and G20 countries, as well as most major international financial centres, signed a “multilateral competent authority agreement” that will activate the automatic sharing of financial data for tax purposes. The signing ceremony took place at the Global Forum on Transparency and Exchange of Information for Tax Purposes in Berlin on 29th October.

It shows the determination from governments across the globe to prevent tax evasion and capture lost tax revenue. Tax authorities of participating countries will be able to gather much more information on the assets their taxpayers hold abroad.

The OECD explains that automatic exchange of information “can provide timely information on non-compliance where tax has been evaded either on an investment return or the underlying capital sum, even where the tax administrations have had no previous indications of non-compliance”.

58 jurisdictions, known as the “early adopters”, have pledged to make the first exchange in 2017. This includes Spain, the UK, Spain, Germany, most of the EU, Isle of Man, Jersey, Guernsey, Gibraltar, Bermuda, Cayman Islands, British Virgin Islands, Iceland, Liechtenstein, San Marino, Seychelles, Argentina and South Africa.
A further 35 jurisdictions have said they will start in 2018. This includes Hong Kong, Monaco, Singapore, United Arab Emirates and, significantly, Switzerland.

Although not one of the early adopters, the Swiss government has adopted mandates to soon begin negotiations with the EU and other countries on automatically sharing data on bank accounts from 2018.