IMF/WB & G20 Finance Ministers and Central Bank Governors Meeting: Session on International Tax Issues

 

Remarks by Angel Gurría,

Secretary-General, OECD

17 April 2015

Washington, DC, United States

(As prepared for delivery)

 

Deputy-Prime Minister Babacan, Ministers, Colleagues,

 

After 18 months of hard work, we are now in the decisive stages of the G20/OECD BEPS Project. In Lima, six months from now, at our dinner dedicated to discussing the G20 tax agenda, I will be presenting to you the full package of 15 BEPS deliverables agreed by consensus between the 44 members of OECD and G20.

 

With just 6 months to go, there remain a few important items to finalise. Tax officials will meet in May and again in September to conclude the negotiations on these remaining elements which include complex issues such as transfer pricing and improving the dispute resolution mechanisms that address double taxation. Your leadership is therefore essential at this point in time, to send a strong message for our officials to reach a principle-based agreement on measures that will effectively attack the loopholes which have allowed base erosion and profit shifting practices to take hold in the past.

 

All countries have also recently been invited to join the ad hoc Group for the negotiation of the multilateral instrument which will be finalised in 2016. This will be a powerful tool to support rapid and coherent implementation of the tax treaty-related BEPS measures across the existing network of over 3 000 bilateral treaties, and I encourage all countries to be involved.

 

To avoid losses in tax revenue as corporate income becomes stateless and to assure the integrity of our tax systems, we must act in concert. Tax remains a sovereign issue, but without cooperation and a level playing field, your national policies on these tax issues which cut across borders, are weakened.

 

It is in the coming months that your voices will make the strongest impact, giving your experts the guidance required to reach consensus agreement on the best technical solutions. I hope to count on your persistent and energetic support to deliver, next October, the Action Plan we committed to in 2013.

 

On tax transparency, our work to narrow the opportunities for tax evasion continues, and in September the Global Forum will deliver the latest results from their peer review process. I will also present the final report on tougher incentives, targeting those jurisdictions which are not meeting their commitments.

 

We undermine our own safeguards if we allow jurisdictions to continue to benefit, unrestrained, from failing to meet the international standard for information exchange on request. After delivering the new standard for the automatic exchange of financial account information, we have also been hard at work supporting your officials as they move rapidly forward on implementation. This includes training sessions being held across the globe and a new web portal to provide all the information necessary for tax authorities and financial institutions. To fully access the benefits of AEOI, your tax officials will need to be supported to ensure the necessary legal, technical and procedural framework is in place to begin the first automatic exchanges in 2017 and 2018. Progress and implementation will also  be reviewed by the 126-member Global Forum.

 

The solutions we develop in the international tax area must be truly global, and to engage locally with tax policy and administration officials in developing countries, we have just completed another round of five BEPS consultations held across the globe with our regional partners in February and March. Developing countries must be at the heart of our engagement on the international tax agenda, especially this year, with attention focusing on the post-2015 Sustainable Development Goals and the means for financing development. Our tax work - not only BEPS but also the development of several pilots in developing countries for the automatic exchange of information - has a central role to play to underpin those global efforts.

 

Finally, mandated by the G20 Presidency we have also begun work to assess the impact of tax policy on the SME sector. Small to medium-sized businesses in OECD and G20 countries can play an important role in building sustainable growth and in global value chains. Therefore, in September, I will deliver a report on how taxation can drive further growth and better outcomes for SMEs.

 

Whether tackling tax evasion and avoidance or addressing other, emerging, challenges to the international tax system - with your commitment and support, the G20-OECD partnership on tax will continue to deliver tangible results that are having a real impact in our communities for a stronger, fairer and more inclusive growth.

 

Thank you.