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New International Tax Fraud, Evasion Agreement Forged

New International Tax Fraud, Evasion Agreement Forged

Los Angeles, CA – Finance officials from 51 countries have signed an agreement to speed the automatic exchange of tax information, eliminate banking and tax fraud and reduce international tax evasion.

The new pact – the Multilateral Competent Authority Agreement – was negotiated over several years and was finalized at a recent conference in Berlin, Germany, organized by the Paris-based Organization for Economic Cooperation and Development (OECD).

OECD Secretary General Angel Gurria said the taxation deal should “help to recover the trust the public today has lost” during the global financial crisis and economic downturn.

“Tax evasion is not just illegal, it is immoral,” Britain’s finance minister, George Osborne, told a news conference by the ministers. “You are robbing from your fellow citizens and you should be treated like a common thief.”

French Finance Minister Michel Sapin described the Berlin agreement as the “first pillar in fighting tax fraud committed by private people”. “Then we need to reduce tax optimization by companies,” he added.

The European Union has enforced the automatic exchange of interest income since 2005 and America’s Foreign Account Tax Compliance Act (FATCA) has required non-U.S. institutions to provide U.S. tax authorities with data on accounts since 2010.

The U.S. was not a signatory to the new agreement, however, Germany, France, Italy, Spain and the UK  are negotiating with Washington for FATCA to be implemented reciprocally.


Major Exporters Taking ‘Little Action’ on Bribery

Los Angeles, CA – Corruption in trade “is undermining global development as contracts don’t go to the best suppliers, prices are being inflated to cover bribe payments, environmental requirements are not being enforced and taxes are not being collected,” says Germany-based Transparency International (TI).

As a result, it said, “the convention’s fundamental goal of creating a corruption-free level playing field for global trade is still far from being achieved.”

According to the anti-corruption watchdog says 22 countries exerted “little or no” energy in enforcing international anti-bribery laws last year.

According to TI, those countries involved account for 27 percent of world exports and almost 90 per cent of total foreign direct investment outflows.

The non-governmental government (NGO) said only four OECD countries were actively enforcing the anti-bribery convention – Germany, Great Britain, Switzerland, and the U.S.

Among those with little or no enforcement, TI said, were Japan, the Netherlands, South Korea, Russia, Spain, Belgium, Mexico, Brazil, Ireland, Poland, Turkey, Denmark, Czech Republic, Luxembourg, Chile and Israel.

Others, including France, Sweden, South Africa and New Zealand, were chided for exerting only “limited” enforcement of the convention.

The binding, international Convention on Combating Bribery of Foreign Public Officials in International Business Transactions was enacted by the Paris-based Organization for Economic Cooperation and Development (OECD) in 1997.

Widely seen as an important instrument in the drive to curb global corruption, the treaty requires the 41 signatory countries to make foreign bribery a crime for which individuals and enterprises can be made responsible.

TI annually assesses compliance with an anti-bribery convention signed by 41 countries that prohibits bribes to win contracts, or dodge taxes and local laws.

The agency urged the world’s exporting countries to take a “tougher stance on bribery and provide adequate support, including staffing and funding for enforcement with rigorous OECD monitoring.”