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OECD Delivers Rules To Prevent Tax Transparency Standard Evasion

13 March 2018

The OECD has issued new model disclosure rules that require lawyers, accountants, financial advisors, banks, and other service providers to inform tax authorities of any schemes they put in place for their clients to avoid reporting under the OECD/G20 Common Reporting Standard (CRS) or prevent the identification of the beneficial owners of entities or trusts.

About 100 territories will begin to automatically exchange information on offshore financial accounts under the CRS this year.

The new rules released March 9 are intended target those circumventing the CRS and their advisers, by introducing an obligation on a wide range of intermediaries to disclose these schemes. The new rules also require the reporting of structures that hide beneficial owners of offshore assets, companies, and trusts.

"Time is up for tax evaders and their advisors that still want to game the rules and continue to hide assets offshore", Pascal Saint-Amans, Director of the OECD Centre for Tax Policy and Administration, said. "With the automatic exchange of CRS information becoming a global reality this year, it is the right moment to get hold of those taxpayers and advisors that attempt to undermine the reporting on offshore assets and that try to play the new global tax transparency framework."

"The mandatory disclosure rules will be a powerful tool to detect taxpayers that continue to refuse to be compliant with their obligations to declare their assets and income to their tax authorities. They will also have a deterrent effect against the design, marketing, and use of schemes to avoid CRS reporting or hide beneficial owners behind opaque offshore structures. This is key both for the integrity of the CRS and for making sure that taxpayers that can afford to pay advisors and to put in place complex offshore structures do not get a free ride."

The model disclosure rules will be submitted to the G7 presidency and are part of a wider strategy of the OECD to monitor and act upon tendencies in the market that try to avoid CRS reporting and hide assets offshore. As part of this work, the OECD is also addressing cases of abuse of "golden visas" and similar schemes to circumvent CRS reporting.


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Mexico - Saudi Arabia

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Pakistan - Philippines

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Singapore - Tunisia

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Luxembourg - Oman

The Luxembourg Government on February 23, 2018, reported it is pushing for the negotiation of an amended DTA with Oman.

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According to a monthly update from the Mexican Government, Mexico's DTA with Jamaica entered into force on February 24, 2018.

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According to preliminary media reports, Kazakhstan's Senate on February 15, 2018, approved a law to ratify a Protocol to the DTA with Azerbaijan.

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