Archive for the ‘Tax Evasion’ Category

Switzerland consults on implementing AEOI Agreements

Thursday, December 29th, 2016

The Swiss Federal Department of Finance (FDF) has launched a consultation aimed to introduce the automatic exchange of information (AEOI) related to tax issues with a list other countries.

The consultation will run until March 15, 2017.

The list includes the following jurisdictions:
Andorra,
Argentina,
Barbados,
Bermuda,
Brazil,
the British Virgin Islands,
the Cayman Islands,
Chile,
the Faroe Islands,
Greenland,
India,
Israel,
Mauritius,
Mexico,
Monaco,
New Zealand,
San Marino,
the Seychelles,
South Africa, Turks and Caicos,
Uruguay.

The AEOI with the above-mentioned countries is to enter into force on January 1, 2018, with the first exchanges to take place in 2019.

The FDF said that the introduction of the AEOI with these countries confirms Switzerland’s international commitment to implementing the AEOI standard as well as strengthens the competitiveness, credibility, and integrity of Switzerland’s financial center. The implementation of the AEOI will be based on the Multilateral Competent Authority Agreement on the Automatic Exchange of Financial Account Information.

In 2017, Switzerland will introduce the AEOI with EU member states, Australia, Iceland, Norway, Japan, Canada, South Korea, and the British crown dependencies of Jersey, Guernsey, and the Isle of Man. To enter into force, the agreements require parliamentary approval of these countries.

UN expert calls on new boss to fight Tax Havens

Thursday, October 20th, 2016

The new United Nations Secretary-General, António Guterres, is being asked by one of the body’s human rights experts to call a world conference on tax avoidance and evasion, with a view to abolish all tax havens.

The UN’s independent expert on the promotion of a democratic and equitable international order, Alfred de Zayas, said that Guterres’ appointment as the new UN leader offered “a unique opportunity to advance the fight against tax evasion and illicit financial flows” when the world’s attention is on these crucial problems.

“Trillions of dollars necessary for combatting extreme poverty and addressing climate change are being kept offshore, thus escaping just taxation and effectively stealing hundreds of billions of dollars each year from the public treasuries,” he stated.

He also noted: “Widespread tax avoidance, tax evasion, tax fraud and profit-shifting, facilitated by bank secrecy and a web of shell companies registered in tax havens, are now routinely documented, but their true human cost is only revealed progressively”, following the publication of his report to the General Assembly on these matters.

According to him, a growing number of human rights experts were pointing to tax abuse as a human rights issue.

“Corruption, bribery, tax fraud and tax evasion have such grave effects on human dignity, human rights and human welfare that they shock the conscience of mankind. They should be prosecuted nationally and internationally,” de Zayas said.

UK bill to open details on multinational Tax Evasion

Friday, September 9th, 2016

A legislative amendment in the United Kingdom this week will give the British government the power to publish details of tax payments made by UK-based multinational corporations on a country by country basis, as tax authorities try to clamp down on the abuse of tax laws and aggressive tax avoidance.

The change in the law followed cross-party calls for companies to publish the details of where they do their business and the tax they pay in each place, which came in response to the controversy surrounding a deal between the government of the UK and Google to repay GBP 130 million in back taxes earlier this year.

In August, the European Commission ruled that Ireland should recover up to EUR 13 billion from Apple in back taxes.

Director of the Financial Transparency Coalition described it as a welcome step but said it was important for the government to actually use the power it now has by releasing country by country reports of UK multinationals to the public as quickly as possible. He said: “It’s time to break out of perpetual scandal mode and make some changes to business as usual. A financial system that relies on plausible deniability and shifting responsibility is inherently shaky, and it’s simply not sustainable.”

EU signs agreement with IOTA to fight Tax Evasion

Friday, July 29th, 2016

An Agreement for Cooperation has been signed by the Intra-European Organisation of Tax Administrations (IOTA) with the European Commission to allow them to work more effectively towards the common goals of the two bodies – particularly, cracking down on tax evasion.

According to an announcement made by IOTA on July 26, the main areas of collaboration under the agreement include cooperating in the fight against tax fraud, information exchange, providing mutual assistance, supporting tax authorities to improve taxpayer compliance rates, and supporting capacity building.

The agreement between IOTA and the Taxation and Customs Union Directorate General (DG TAXUD) of the European Commission was signed during IOTA’s General Assembly on July 7 in Bucharest by IOTA’s President, Octavian Deaconu, and Caroline Edery, Head of Unit, Tax Administration and Fight Against Tax Fraud, DG TAXUD.

IOTA is a non-profit intergovernmental organization based in Budapest that is aimed at promoting best practices in tax administration and more effective cooperation between its 46 member tax authorities.

Football Star accused of Tax Evasion through offshore companies

Thursday, June 2nd, 2016

Lionel Messi, a 28-year-old 5-time World Player of the Year, and his father Jorge Messi were accused of using offshore companies in Belize and Uruguay in order to avoid over EUR 4 million in tax.

In his and his father’s trial over tax evasion, Messi insisited that he did not make attempts to avoid paying taxes on EUR 4.16 million of his income earned through the sale of his image rights from 2007-2009

When giving testimony in the court in Barcelona, the Argentina skipper said: “I didn’t know anything, all I know about is playing football and winning.” He also said: “I only knew that sponsors would pay X amount of money, that I had to do adverts, photos and things like that.” He declared that he had never read anything but I would sign where the lawyers said.

Tax authorities are asking that both Leo and his father serve about 2 years in jail for the offence, but the public prosecutor is only pursuing Messi Sr.

Jorge Messi, Leo’s father and co-defendant, had earlier claimed that he didn’t realise the Belize company that managed image rights deals didn’t pay taxes in Spain, and that he never informed his son of the details of sponsorship deals. “Since the start of Leo’s career I only tried to make his life easier,” he said.

Belize to enhance Anti-Money Laundering

Sunday, May 22nd, 2016

To strengthen the jurisdiction’s safeguards against financial crime, Belize’s Financial Intelligence Unit and Belize Police have signed a memorandum of understanding.

The memorandum will strengthen the existing cooperation and facilitate the analysis and investigation of suspected money laundering, associated offenses, and the financing of terrorism. Implementation of the document is expected to increase the potential sources of information available to both the Financial Intelligence Unit and the Police in their fight against crime. Also, joint operations between the authorities will be possible.

The Financial Intelligence Unit is the Belizean authority dealing with the enforcement and implementation of all anti-money laundering and counter-terrorism financing regulations and the prevention of domestic tax evasion.

Money laundering to become difficult in next 1-2 years, Indian Finance Minister says

Thursday, November 5th, 2015

According to Arun Jaitley, Minister for Finance, Corporate Affairs, Information, and Broadcasting in the Government of India, tax evasion and money laundering will become extremely difficult in the future. He warned lawbreakers that real-time global automatic exchange of information system will come into effect.

Indian finance minister said: “I am quite certain that the activity is going on in that direction and the next 1-2 years are also going to bring significant results because with almost real-time exchange of information, lives are going to become extremely difficult as far as lawbreakers in that regard are concerned,” the minister said in his inaugural speech at international conference on ‘Networking the Networks’.

Jaitley noted that tax evasion and stashing away illegal money anywhere in the world is becoming increasingly difficult after a G20 initiative that is being taken up by various international institutions.

The initiative, firmed at the Australia summit of G20 last November, is a new global arrangement under which countries will begin automatic exchange of tax information in stages beginning April 1, 2017. India, one of the early adopters, will begin sharing from the first date. Also, the OECD has recently announced the rules for the Base Erosion and Profit Shifting (BEPS) framework, which seeks to ensure that trans-nationals pay tax at least at some place.

Italy amends Black Lists of countries as regards tax information exchange

Tuesday, April 7th, 2015

On April 1, Italy’s Minister of the Economy and Finance, Pier Carlo Padoan, signed 2 decrees that modify Italy’s “black lists,” and announced on the same day that Italy and the Vatican had signed their previously agreed tax information exchange agreement (TIEA).

The 2 decrees follow the guidelines laid down in Italy’s 2015 Stability (Budget) Law, which established amended criteria for the production of 2 black lists that is expected to boost economic connections with foreign countries.

Under the framework of Italy’s controlled foreign company (CFC) regime, the black list includes territories that do not have an adequate TIEA with Italy and if they have an effective corporate tax rate that is at least 50% lower than the effective tax rate that would be applicable if the company was an Italian resident.

The Stability Law specified another black list under which expenses incurred in transactions with residents in a jurisdiction would not be deductible. For this list, the criterion that such a jurisdiction should not have a privileged tax regime has been eliminated, leaving only the presence of an adequate TIEA with Italy as the determining factor.

The “non-deductibility of costs” list now therefore includes only 46 tax jurisdictions. 21 have been cancelled as already having TIEAs in effect. They are as follows: Alderney, Guernsey, Jersey, the Isle of Man, Gibraltar, the British Virgin Islands, Anguilla, the Netherlands Antilles, Aruba, Belize, Bermuda, Costa Rica, the United Arab Emirates, the Philippines, the Cayman Islands, the Turks and Caicos Islands, Malaysia, Mauritius, Montserrat, and Singapore.

This second list still includes Switzerland, Liechtenstein, and Monaco, despite the fact that all have recently signed TIEAs with Italy. At the time it was indicated that completion of those TIEAs would be a prerequisite for Italians with undeclared assets in those countries to be able to enter into Italy’s current voluntary disclosure program.

Germany seizes tax evasion info

Sunday, June 22nd, 2014

German customs authorities in the Port of Hamburg have confiscated documents that may contain information about the accounts of suspected tax evaders. This was reported by German media on June 21.

Two containers with around 14,000 documents inside were confiscated at the end of May, with some coming from a branch of private bank Coutts, a subsidiary of the Royal Bank of Scotland, in the Cayman Islands, newspaper Welt am Sonntag said in an advance copy of an article due to be published on Sunday.

It was also reported that customs authorities confiscated a container of Coutts documents from the Cayman Islands on May 20. Since then, finance experts had been evaluating the information and searching for evidence of tax evasion.

A spokesperson for Coutts told Reuters: “We are not aware of any investigation into our Trust Company or its papers and we are working with the authorities to allow these papers to continue on their way.”

Vatican says bank needs ‘corrective measures’

Monday, May 19th, 2014

The Vatican’s financial watchdog agency said that “corrective measures” were necessary at the Holy See’s troubled bank to continue the path toward financial transparency and compliance with international anti-money laundering norms.

According to Financial Intelligence Authority Director Rene Bruelhart, a long-awaited investigation of the bank, known as the Institute for Religious Works, included looking into its practice of not disclosing the names of the true account holders in its transactions with Italian banks. He said that the main problems identified in the inspection concerned the bank’s procedures for identifying high-risk activities, and that more detail was necessary.

He said over the coming weeks, he would discuss a proposed action plan with bank managers “to take certain corrective measures to have a full implementation (of the Vatican’s anti-money-laundering law) in the IOR.”

The majority of the 202 new cases stemmed from transactions at the Vatican bank, which is reviewing each of its accounts to make sure it is clean and that the bank has complete information on the client.