OECD Tax Forum Encourages Multi-Gov't Approach

by Ulrika Lomas, Tax-News.com, Brussels

24 January 2012

Tax administrations from 43 countries have concluded their 7th 'Forum on Tax Administration' meeting, headed by the Organisation for Economic Cooperation and Development as part of its policy agenda to unify advanced nations in its fight against tax evasion.

Reviewing progress made to date, administrations agreed, in a communique published by the OECD, that: “Although there have been some high-profile successes in the fight against offshore tax abuse, resulting in significant additional tax revenues and real improvements in transparency and exchange of information, it is far too soon to declare victory.”

The OECD called for a “unified and strengthened commitment to combat offshore tax abuse,” including through greater country-to-country cooperation, including through the use of information exchange and coordinated action “to better identify and pursue the promoters and users of abusive offshore schemes.”

"When promoters and facilitators feel that we are tightening the net, they may simply move to a new location. Our Offshore Compliance Network is building on the achievements of individual countries to improve our collective ability to deter, detect, and deal with offshore tax evasion. An early priority is to better understand the structures used to hide offshore wealth." According to the Organisation, administrations at the meet agreed to coordinated actions to tackle evasion in this area.

The OECD further reported that attendees agreed that 'in times of shrinking budgets', administrations must build stronger relationships with large corporations to foster cooperation. “We agreed that we need to create innovative strategies for issue resolution that are less time and resource intensive for both, while still promoting a climate that encourages compliance with tax laws,” the OECD reported after the meet. “We will pay particular attention to the process of conducting and resolving transfer pricing cases. Overall, we intend to move away from a hide and seek approach to one based on greater transparency on the part of both taxpayers and tax administrations,” the OECD said.

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