Global Financial Integrity

 

As Swiss Approach U.K. Tax Deal, Reminders that Global Solution to Financial Opacity Still Needed

SHARE
Monique Perry Danziger, +1 202 293 0740 ext. 222

Global Financial Integrity Calls for Automatic Exchange of Tax Information

WASHINGTON, DC – Amidst speculation over details of a possible tax agreement between Switzerland and Britain, Global Financial Integrity (GFI) reiterated the message that a broader, global solution to illicit financial practices and banking secrecy is needed.

“The recent agreement to remit information on secret Swiss accounts with Germany was a spot-check fix,” said GFI director, Raymond Baker. “The Swiss are handing over money and some account information without making substantive changes to a system that puts tax collection and law enforcement officials at a disadvantage.”

End Tax Haven SecrecyUnder current standards, based on the Organization for Economic Cooperation and Development’s (OECD) Model Tax Convention (Article 26), countries are obliged to exchange information that is “foreseeably relevant to the correct application of a tax convention as well as for purposes of the administration and enforcement of domestic tax laws of the contracting states.”

“Under the current standard tax collection authorities are required to provide information and justification for information that is often prohibitively difficult to obtain,” said Baker. “Automatic exchange of tax information would eliminate the cat and mouse games and ensure that tax evaders cannot easily stash their money in offshore, secret bank accounts.”

It is estimated that individuals have about US$12 trillion of assets in jurisdictions other than their own countries of residence that are not declared in their own countries of residence; the lost tax revenue annually from such undeclared assets is estimated at US$255 billion. Tax evasion by corporations and other entities is also a major problem.

GFI is calling on the G20 to implement broader, global reforms at the next G20 summit, to be held in Cannes, France in November. In addition to conducting high-level outreach to the G20, GFI has launched—in coalition with NGOs from around the world—the End Tax Haven Secrecy (ETHS) campaign, a global grassroots effort calling on G20 leaders to end tax haven secrecy at the Cannes Summit.  The campaign, which just launched a new web video this month, has already generated roughly 10,000 letters to G20 leaders from individuals world-wide.  To learn more about the campaign, visit www.EndTaxHavenSecrecy.org.

Visit the Task Force on Financial Integrity & Economic Development’s portal on Automatic Tax Information Exchange for more information on the automatic exchange of tax information.

____

Global Financial Integrity (GFI) is a Washington, DC-based research and advocacy organization which promotes transparency in the international financial system.

For additional information please visit www.gfip.org.

Follow us on: Twitter | Facebook | YouTube