Speech by Angel Gurría
31 March 2015
(As prepared for delivery)
Dear Parliamentarians, ladies and gentlemen,
It is a pleasure to address you again, this time on the important work we are doing with the European Union on tax transparency.
The OECD and the EU have worked hand in hand over many years to tackle some of the greatest challenges on the international tax agenda. Working together to ensure the coherence of global tax rules is absolutely critical – for governments and for business, coherency improves effectiveness, increases efficiency and reduces unnecessary compliance costs.
On tax evasion, the EU has supported the global push for greater tax transparency and today we have the global common reporting standard on automatic exchange of information, committed to by more than 90 jurisdictions.
We have worked closely together to ensure that EU directives on this issue will intersect with the global standard, and that the global information exchange network which we have jointly created plays a key role in detecting and deterring tax evasion across the world.
Increased transparency is also critical to broader efforts to enhance cross-border cooperation and develop a common approach to the challenge posed by Base Erosion and Profit Shifting - or BEPS, as we call it at the OECD.
The OECD/G20 BEPS Project, launched in 2013, has been strongly supported by the EU since its inception. With eight of the fifteen actions still to be delivered by the end of this year, we will address some of the most egregious arrangements used by multinationals to separate their corporate profits from the location of their underlying economic activities.
We have greatly appreciated the strong contribution of EU members to the BEPS Project, and have been working closely with the Commission to ensure its own initiatives arising from the BEPS Project, including the recently announced proposals to improve the sharing of information on tax rulings, are in line with the global measures being developed under BEPS.
In the coming months, we will continue to work with the Commission as they develop the other proposals outlined in the Tax Transparency Package. Looking ahead, rigorous implementation will be the chief determinant of success. That means, the EU and the OECD will need to keep cooperating closely to ensure that we remain coherent as governments adopt and administer the new measures.
What has become crystal clear over the past decade is that globalised economic activity and new business models mean that governments can no longer afford to focus only within their own borders. Ensuring effective tax policy requires an understanding of the interaction with trade and investment partners, the drivers of business arrangements, and the intersection between national tax systems.
If we want to move forward on a more sustainable, resilient and inclusive path to growth, the imperatives of trade, investment and growth must be balanced against social and fiscal policies conducive to the public good. Businesses must be assured of appropriate levels of confidentiality and stability. Meanwhile, governments must be armed with the information and the tools they need to monitor, tax and regulate the private sector in the legitimate interests of society as a whole.
Building on our strong history of collaborative and consultative work on tax issues, the OECD and the EU must push to ensure our work has a global impact. Tax transparency will help rebuild trust in our market and governance institutions by restoring the integrity of our tax systems in the eyes of citizens. It will help rebuild trust in our governments, and in our political parties. It will strengthen trust in democracy itself!
Remember, our tax systems are the vertebral column of our social contracts. Let’s keep working together to strengthen them!
I would now like to hand over to Mr. Pascal Saint-Amans, Director of the OECD’s Centre for Tax Policy and Administration who has played a central role in this work, and who will brief you on the very latest developments.