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G20 finance ministers welcome ‘significant progress’ on BEPS

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The finance ministers and central bank governors of the G20 welcomed the ‘significant progress achieved towards the completion of our two-year G20/OECD base erosion and profit shifting (BEPS) action plan’ at their meeting in Cairns, Australia, on 20–21 September, and vowed to ‘commit to finalising all action items in 2015’. In a statement, they said: ‘We endorse the finalised global common reporting standard for automatic exchange of tax information on a reciprocal basis which will provide a step-change in our ability to tackle and deter cross-border tax evasion. We will begin exchanging information automatically between each other and with other countries by 2017 or end of 2018, subject to the completion of necessary legislative procedures.

‘We welcome progress so far, and … will continue to take practical steps to assist developing countries preserve and grow their revenue bases and stand ready to help those that wish to participate in automatic information exchange.’

In related news, the G20 has mandated the OECD and its Global Forum on Transparency and Exchange of to develop toolkits to support developing countries addressing BEPS and to launch pilot projects to assist them to move towards automatic exchange of information. This mandate comes in response to two reports:

  • a new report on the impact of BEPS in low income countries. This sets out areas where additional guidance and tools are required to ensure that the BEPS outcomes fully benefit lower capacity countries. The report also highlights the actions developing countries have taken which indicate good opportunities to raise additional revenues from addressing BEPS issues and to create a more certain and stable investment climate for business; and
  • a roadmap for developing country participation in the new global standard for the automatic exchange of information between jurisdictions. This is said to provide a stepped approach to ensuring developing countries can overcome obstacles in implementing the new standard. It identifies the benefits, costs and the fundamental building blocks that developing countries need in order to meet the standard.

Speaking from Cairns, OECD tax policy director Pascal Saint-Amans said: ‘This demonstrates that we are serious about pursuing the dialogue with developing countries on BEPS and giving them a seat at the table.’

The OECD will report to the G20 leaders in November on its plan to deepen the involvement of developing countries in the OECD/G20 BEPS project and ensure that their concerns are addressed.

Categories: News , International taxes