South Africa is one of only 18 countries that comply fully with international standards on the transparency and exchange of taxpayers information, the Treasury said in a statement on Wednesday.
The exchange of tax information on request refers to when one tax authority seeks financial information from its counterpart.
It relates to both individual and corporate taxpayers, according to the Global Forum on Transparency and Exchange of Information for Tax Purposes.South Africa outperformed countries like the United Kingdom, United States, Qatar and Mauritius.
Finance Minister Pravin Gordhan said South Africa’s ranking is testimony to the excellence of some of the country’s institutions of democracy. ”The exchange of information will contribute to the reduction of opportunities for tax evasion and therefore contribute to the creation of an international tax system that is more effective, efficient and fair,” added Gordhan.
Full compliance with the standards of transparency and exchange of tax-related information means that a country has the relevant information, that such information is accessible, and that the information can be exchanged.Other compliant countries included Australia, China, France, India, and New Zealand, while the British Virgin Islands, Cyprus, Luxembourg and the Seychelles fell in the non-compliant category.
The ranking was the culmination of three years’ worth of reviews tow phases of reviews. Phase one involved the review of a country’s legal and regulatory framework for transparency and the exchange of tax information, while the second phase surveyed the implementation of the standards.