A conference on tax reform at both national and international level took place in London yesterday. Experts agreed that tax systems across the world were outdated and extremely complicated.
In her keynote speech to the conference, Grace Perez-Navarro, deputy director of the Organisation for Economic Co-operation and Development, agreed that governments across the globe needed to fix mismatches in national tax laws and gaps in international tax rules to bring them into the 21st century.
She said this was especially important as developing countries depended on corporate income tax.
‘Governments worldwide have recognised the need for coordinated action to ensure the integrity of the international tax system,’ she told delegates.
‘Our efforts to increase transparency, combat offshore evasion and counter tax avoidance by multinational enterprises are having an impact ion the ground and helping countries to make sure that all taxpayers pay their fair share.’
A new global standard on automatic exchange to help governments across the world share information to fight tax fraud was endorsed by all OECD and G20 countries, Perez-Navarro noted.
Ninety-three jurisdictions, many represented at ministerial level, signed a Multilateral Competent Authority Agreement that will activate automatic exchange of information. It provides for automatic exchange of all financial information on an annual basis.
Margaret Hodge, chair of the UK Public Accounts Committee, told the conference that the success of international efforts to tackle tax avoidance depended on all countries being prepared to play by the same rules.
‘[Countries should] not adopt a two-faced approach where they sign up to OECD standards in principle, but try and undercut one another in practice.’
