Welcome to a world without rules

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John Christensen of the Tax justice network gave a speech in Elverum, Norway yesterday. It had the above title. It was given to the Norwegian Association of Tax Auditors and Accountants.

He concluded by saying:

We face clear choices about the future of the globalisation project. We can allow secrecy jurisdictions to continue with business as usual: the outcome will be an anarchic world order of disorder and insecurity.

The alternative is a system that respects the taxation rights of sovereign states; which requires transparency of market relevant information; which supports cooperation on information sharing, on taxing capital, and on disclosure of ownership; which recognises that tax dodging is both economically harmful and anti-democratic, and which asserts the widely-accepted principle that progressive taxation serves the public interest.

I gather it was very well received.

The times they are a changing.

When will the ICAEW follow suit?

When will they consider these proposals he put forward in Norway?:

European countries both can and should take the international lead in tackling secrecy jurisdictions. The Tax Justice Network suggests the following actions:

- Adopting an international accounting standard for country-by-country reporting by multinational companies;

- Supporting proposals to strengthen the UN Tax Committee to help this Committee become the principal forum within which norms for multilateral tax
cooperation can be agreed;

- Strengthening and broadening the EU Savings Tax Directive and entering into information exchange agreements based upon the principle of automatic
exchange with countries outside the Union;

- Promoting the UN Code of Conduct on International Cooperation in Combating Tax Evasion, to create a benchmark for testing the actions of secrecy
jurisdictions and the financial professionals who promote tax evasion services;

- Pushing for tax evasion to be treated as a predicate crime under the UN Convention Against Corruption, and under the AML regimes of all countries
providing financial services to non-resident clients, and requiring the International Monetary Fund to extend the process of its Reports on the Observance of Standards and Codes to include matters relating to banking secrecy, disclosure of ownership, and ability to comply with requests for information exchange;

- Requiring all European secrecy jurisdictions and their dependent territories to:

(i) provide full public disclosure of the beneficial ownership of all legal entities registered under their jurisdiction;
(ii) to abolish banking secrecy arrangements;
(iii) to demonstrate their capability to engage in effective information exchange; and
(iv) to require all professionals covered by AML regulations to automatically submit suspicious activity reports for each and every client who they suspect of tax evasion.

Is that too much to hope for, soon?


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