Author: Ferdie Schneider (BDO). Greater transparency will expose undeclared offshore accounts Globalisation has dramatically increased cross-border financial activities.This necessitated enhanced co-operation and understanding between tax authorities to curb tax evasion and to ensure a fair allocation of taxes among the jurisdictions in which the activities take place. The Organisation for Economic Co-operation and Development (OECD) developed a Common Reporting Standard (CRS) for the automatic exchange of information relevant to tax. Over 50 jurisdictions have agreed to comply with the CSR, including South Africa, committing to exchange data in September 2017. Other jurisdictions will participate from 2018.
Category: OECD – BEPS Project
Greater tax transparency for multi-nationals a step closer
Author: Amanda Visser (MoneyWeb). Additional record-keeping requirements published. The South African Revenue Service (Sars) has published additional record-keeping requirements for large multi-national companies which they will have to comply with in future. Many companies have already included some of the required information in their transfer pricing documentation and on their annual tax returns, but there seems to be uncertainty about the format in which it must be available to Sars.
Higher price on carbon needed to effectively tackle climate change
OECD urges efforts to better price carbon as new analysis finds that 90% of CO2-emissions are priced below EUR 30 per tonne, a low-end estimate of climate damage, and 60% are not priced at all. Effective Carbon Rates in the OECD and Selected Partner Economies calculates effective carbon rates (ECR) on CO2-emissions from energy use for 41 countries which together use 80% of global emissions. CO2-emissions from energy use are a primary contributor to climate change. Putting a price on carbon, through taxes or through emissions trading systems, is one of the most effective tools for reducing the CO2-emissions from energy use. Prices can reduce energy use, improve energy efficiency, and drive a shift towars less harmful forms of energy.
Tax Transparency – the Common Reporting Standard: Implications for South Africa
Globally, taxpayers are becoming more interdependent, and engage in cross-border financial activities with more regularity. With this, comes the need for enhanced co-operation and understanding across countries on issues such as tax administration and transparency, to curb tax evasion and ensure a fair allocation of taxes to tax jurisdictions. “The Common Reporting Standard (CRS) developed by the The Organisation for Economic Co-operation and Development (OECD), is a global standard for the automatic exchange of information relevant to tax. Over 50 jurisdictions have agreed to comply with the CSR, including South Africa, committing to exchange data in September 2017, and other jurisdictions will begin participating from 2018” states Ferdie Schneider, National Head of Tax at BDO South Africa.
OECD delivers international standard for collection of VAT on cross-border sales
Governments have taken an important step towards ensuring that consumption taxes on cross-border transactions are effectively paid in the jurisdiction where products are consumed, while minimizing the risks that uncoordinated tax rules distort international trade. The decision by representatives of more than 100 countries and jurisdictions to endorse the new OECD International VAT/GST Guidelines as the preferred international standard for coherent and efficient application of Value Added Tax/Goods and Services Tax to the international trade in services was one of the highlights of the annual meeting of the OECD Global Forum on VAT on 5-6 November, in Paris, France. See Statement of Outcomes here.
Global Forum on tax transparency pushes forward international co-operation against tax evasion
Major implementation milestones are being met by members of the world’s leading forum on tax transparency as the international community continues to move ahead towards greater tax transparency. The imminent shift to the automatic exchange of information will send a strong warning to tax evaders. Significant strides towards a major increase in tax transparency have been made since last year when over 90 members of the Global Forum on Transparency and Exchange of Information for Tax Purposes committed to automatically exchange information, beginning in 2017 or 2018. Panama and the Cook Islands are the latest financial centers to join these commitments bringing the total number to 96.
The OECD/G20 base erosion and profit shifting (BEPS) project – an informed perspective
Author: Lisa Brunton (Cliffe Dekker Hofmeyr) The BEPS Project involves input from the 34 member countries of the OECD, all G20 members, and more than 40 developing countries. The objective of the BEPS Project is to close gaps in international tax rules, effectively eliminating or substantially reducing BEPS; and to secure government revenues by ensuring that profits are taxed in the jurisdiction where the economic activities generating such profits are performed and where value is created. In our October 2014 Tax Alerts, we reviewed the 2014 deliverables of the BEPS Project and speculated about whether the OECD would be able to achieve its 2015 objectives timeously.
Action plan to stem tax avoidance is a good start
Author: Mzukisi Qobo (BDlive) The brunt of tax avoidance by big corporations falls heavily on poor countries, with long-term effects on growth and social stability. African countries are the poorer for it. The recent Organisation for Economic Co-operation and Development (OECD) action plan on base erosion and profit shifting, adopted by Group of 20 (G-20) finance ministers in Peru a week ago, has been hailed as groundbreaking. The measures it proposes create an important basis for evolution of new norms on international tax treaties and to curb aggressive tax planning by companies.
The Global Forum releases new compliance ratings on tax transparency
Author: OECD The Global Forum on Transparency and Exchange of Information for Tax Purposes published new peer review reports today for 12 countries or jurisdictions, moving further ahead with its goal to implement global standards on transparency and exchange of information for tax purposes. Phase 1 reports on , , , , , and assessed their legal and regulatory frameworks for transparency and exchange of information on request. These countries were assessed to have legal frameworks in place to enable them to move to the next stage of the review process, which will assess exchange of information practices.
International Tax – Treaty shopping
The concept of base erosion and profit shifting (BEPS) has been much discussed at various international forums including the G20 Finance Ministers and Central Bank Governors meeting in July 2013 in Moscow as well as the G20 Heads of State meeting in September 2013. From a South African perspective, the Davis Tax Committee has been set up, inter alia, in order to address the issue of BEPS in a South African context.