The Organisation for Economic Co-operation and Development, (OECD), has been reporting in two areas of policy development and legislation advancement and effectively a tax haven update from the OECD has been produced from the data reported.
It is clear that the organisation’s aims to crack down on harmful tax practices and on the ability of individuals to evade taxation by banking, doing business or residing in certain countries are becoming more and more successful.
In two separate reports from the organisation we have received the complete findings relating to: - “Improving Access to Bank Information for Tax Purposes” and “Tax Co-operation: Towards a Level Playing Field.” The vast majority of OCED and non-OECD nations comply with the guidelines that the organisation has laid down since 2000 – but certain notable exceptions exist such as Austria, Luxembourg and Switzerland.
These three nations were highlighted as having failed to achieve the standards required by the OCED relating to allowing tax authorities access to bank information. Cyprus, Liechtenstein, Panama and Singapore were also mentioned as failing to come up to standard, and for still allowing unscrupulous individuals the ability to make use of these tax havens for the illegal evasion of personal and business taxation potentially.
All in all however, the OCED are clearly pleased that all their suggestions have been implemented in the vast majority of cases. In their reports they cite successes such as the fact that in 2007 Belgium signed its first tax treaty providing for exchange of bank information for all tax purposes for example, and that there are almost 100 more exchange of information agreements in place today compared to just one year ago. This is allowing for far more transparency in international taxation and preventing taxation loss through evasion and avoidance being made possible.
The policies suggested and drawn up by the organisation’s Global Forum in 2000 are to be review for effectiveness and implementation levels in 2008. Commenting on this fact Paolo Ciocca, chair of the OECD’s Committee on Fiscal Affairs and co-chair of the Global Forum stated: “The time has come for countries that have not yet done so to implement them. In January 2008 the Committee on Fiscal Affairs will have a review of the future direction of this initiative. We will continue to press for further progress and explore within the Committee how such progress could be achieved.”
Offshore tax havens are no longer the money laundering centres that they were once considered to be – while they do allow for creative taxation planning and the ability for legitimate taxation reduction for qualifying individuals and entities, in the majority of cases they are also well regulated fiscal centres that have in place proper legislation and effective anti money-laundering or tax evasion strategies.
