Cooperation Between Tax Intermediaries And Revenue Bodies Essential

by Robert Lee, Tax-News.com, London

24 November 2008

Tax authorities, taxpayers and tax advisers are being offered support in their efforts to achieve an enhanced relationship based on mutual trust and information disclosure, in a new publication issued by KPMG International.

The enhanced relationship was originally proposed by the Organisation for Economic Co-operation and Development (OECD) in its report on research into the role of tax intermediaries, published in Cape Town, South Africa, in January 2008. It offers taxpayers light touch regulation based on commercial awareness, impartiality, proportionality, openness and responsiveness in exchange for greater transparency and disclosure.

KPMG’s new document summarises the results of the study and offers a series of questions aimed at giving tax professionals an opportunity to find a way forward based on a constructive dialogue around the practicalities of the enhanced relationship.

It also introduces a ten-point questionnaire to track progress in developing these relationships around the world. Tax authorities, taxpayers and tax advisers are being encouraged to visit the site and complete the questionnaire to provide a benchmark for future progress.

"When the OECD’s report was published," said Loughlin Hickey, KPMG’s Global Head of Tax and a partner in the UK firm, "we said that this was a breakthrough towards a more collaborative approach to making tax legislation and administration an effective part of economic policy throughout the world."

"But we emphasized that the study should be seen as part of a dialogue, with more work from all sides needed to implement the recommendations effectively. Since then, we have observed that there is much goodwill around the concepts, but we now need to take this debate forward. This is the aim of this initiative by KPMG."

KPMG said that its summary is not a substitute for the original report, but is intended as a way to make it more accessible. The firm added that by developing a series of issues that the report left open, the summary encourages more people to join the debate, and to seek a way forward that is practical for them in the country and context in which they work.

"We think discussions should be forward thinking and practical, which is how we approach the tax governance work we do with clients" said Mr. Hickey. "So we have suggested that progress should be monitored. The summary proposes a qualitative method to do this."

Jeffrey Owens, Head of Tax at the OECD, said: "At a time when the spotlight is on managing costs and revenues for both taxpayers and tax authorities, the principles of risk management, governance and an enhanced relationship are more important than ever. I believe this initiative provides us all with an opportunity to test the outcomes from our meeting in Cape Town. We need to ensure that the enhanced relationship becomes a reality and that tax administrations and taxpayers continue to move towards a relationship based on trust and openness."

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