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14 Territories Praised By OECD For Tax Transparency Advances

by Ulrika Lomas, Tax-News.com, Brussels

29 June 2017


A number of territories that had failed to demonstrate they have complied with international tax transparency standards have had their ratings upgraded by the OECD, following "fast-track" peer reviews.

It said that the territories' frameworks were reevaluated to assess whether recent progress would result in an upgrade to their ratings if they were to be reviewed again. The OECD said the fast-track process was rigorous and informed by peer input but does not substitute a full peer review.

In all cases a full review will be carried out and a peer evaluation done against the revised international standard for exchange of information on request, which now includes the requirement of beneficial ownership, the OECD said.

Under the peer review, countries were deemed non-compliant if they failed to meet two of the following requirements:

  • At least a "Largely Compliant" rating with respect to the Exchange Of Information on Request (EOIR) standard;
  • A commitment to implement the Automatic Exchange Of Information (AEOI) standard, with first exchanges in 2018 (with respect to the year 2017) at the latest; and
  • Participation in the Multilateral Convention on Mutual Administrative Assistance on Tax Matters or a sufficiently broad exchange network permitting both EOIR and AEOI.

Following a fast-track re-evaluation, the Global Forum found Andorra, Antigua and Barbuda, Costa Rica, Dominica, the Dominican Republic, Guatemala, the Federated States of Micronesia, Lebanon, Nauru, Panama, Samoa, the United Arab Emirates, and Vanuatu to be largely compliant.

Meanwhile the Marshall Islands was deemed to be partially compliant, it said. However, Trinidad and Tobago was identified as the only jurisdiction that has not yet made sufficient progress towards satisfactory implementation of the tax transparency standards.

The OECD said discussions are continuing with Trinidad and Tobago, and progress is anticipated soon.

In all cases a full review will be carried out and a peer evaluation done against the revised international standard for exchange of information on request, which now includes the requirement of beneficial ownership.

Commenting on the provisional ratings upgrades, the OECD said: "The provisional ratings reflect the strong progress made by the jurisdictions in implementing the Exchange of Information on Request Standard. A number of critical changes have been introduced by the reviewed jurisdictions, including the elimination of strict bank secrecy and bearer shares, improved access to accounting records, and a more rigorous oversight and enforcement of obligations to maintain information. Further progress has also been achieved on expanding the breadth of the exchange networks including signature of the Multilateral Convention on Mutual Administrative Assistance on Tax Matters."

Panama released a statement welcoming recognition of the changes it has made in recent months. The Panamanian Government said that, in March 2017, Panama requested a fast-track review, "as the previous evaluation was based on out-dated legal frameworks and had failed to take into account the country's new regulatory developments as well as policy decisions." Additionally, Panama ratified the Convention of Mutual Administrative Assistance (MAC), which allows for exchange of tax information with over 100 jurisdictions.

Welcoming the provisional upgrade to "largely compliant," Minister of Economy and Finance Dulcidio De La Guardia said: "This is great news for us. It is a testament to all of our hard work to fight against tax evasion and to meet international expectations and standards regarding transparency, which have been ongoing from day one of the Varela administration. We will continue working for transparency, and today we celebrate that the international community recognizes our commitment to international standards."

TAGS: Nauru | United Arab Emirates | tax | accounting | Organisation for Economic Co-operation and Development (OECD) | Marshall Islands | Samoa | Trinidad and Tobago | Vanuatu | enforcement | Antigua and Barbuda | Costa Rica | Dominica | Dominican Republic | Germany | Guatemala | G20 | standards | Andorra | Lebanon | Panama | Tax

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