29/07/2020 - The rapid spread of exchange of financial information (EOI) between countries over the past ten years has led to much increased transparency in tax matters. Today as yesterday, international co-operation is critical in combating tax evasion and helping domestic revenue mobilisation. Regrettably, many developing countries have not yet benefitted from these developments and are still struggling to enforce their tax legislations. Sub-optimal EOI treaty networks are often the main limiting factor.
The COVID-19 crisis has brought renewed attention to the role and importance of multilateral co-operation in combating tax evasion and helping fiscal consolidation. In line with its mandate to deliver technical assistance and support capacity building, the Secretariat of the Global Forum on Transparency and Exchange of Information for Tax Purposes (the Global Forum) has now produced a Toolkit for Becoming a Party to the Convention on Mutual Administrative Assistance in Tax Matters (MAAC).
Providing detailed guidance, the toolkit outlines the benefits of joining the MAAC. It offers an overview of the MAAC’s main provisions, its relationship with other treaties and legal instruments, and a step-by-step guide to becoming a Party, from the preparation stage to the signature and deposit of instruments of ratification, acceptance or approval.
Jointly developed by the OECD and the Council of Europe in 1988, and amended through protocol in 2010, the MAAC has become the leading international treaty for multilateral co-operation in tax matters. As of July 2020, 137 jurisdictions are participating.
With its global coverage, the MAAC has facilitated the creation of a large number of EOI relationships in a short amount of time and helped increase the number of tax audits and investigations supported by offshore information obtained by tax authorities. Under the umbrella of the MAAC, many developing countries have already started implementing the standards of automatic exchange of information (Common Reporting Standard and Country-by-Country Reporting).
The toolkit is designed to facilitate countries reaching an informed decision on whether to join the MAAC and to provide guidance on the steps to be taken and how to better prepare for joining. In order to facilitate and maximise the use of the toolkit, the Global Forum Secretariat will produce French and Spanish versions, which will published shortly.
The Global Forum is the leading multilateral body mandated to ensure that jurisdictions around the world adhere to and effectively implement both the standard of transparency and exchange of information on request and the standard of automatic exchange of information. These objectives are achieved through a robust monitoring and peer review process. The Global Forum also runs an extensive capacity-building programme to support its members in implementing the standards and help tax authorities make the best use of cross-border information sharing channels.
For further information, journalists should contact Pascal Saint-Amans, Director of the OECD Centre for Tax Policy and Administration, (+33 1 45 24 91 08) or Zayda Manatta, Head of the Global Forum Secretariat (+33 1 45 24 82 29).