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Forum on Tax Administration unveils plan for closer coordination

The heads of tax administration from 38 countries have agreed to implement three actions which they say will help them to work closer together, coordinate their actions, share knowledge and deal with any tax administration aspects arising from the base erosion and profit shifting (BEPS) project.

The group of the most senior revenue officials met in Dublin on October 23 and 24 for the ninth meeting of the Forum on Tax Administration (FTA). They have agreed to:

  • set up the JITSIC (Joint International Tax Shelter Information and Collaboration) Network to focus on cross-border tax avoidance. Membership will be open on a voluntary basis to all FTA members;

  • invest in the implementation of the Common Reporting Standard, the instrument to enable the global automatic exchange of tax information, while protecting taxpayer confidentiality and making sure “common, secure and effective transmission systems are in place”; and

  • improve how the Mutual Agreement Procedure - the instrument for bilateral negotiation between governments on tax cases - works so that issues of double taxation are addressed more quickly and efficiently and that it operates properly for governments and taxpayers.

The JITSIC platform is being formed out of the Joint International Tax Shelter Information Centre, which was set up in 2004 in Washington, DC by Australia, Canada, UK and the US to share knowledge on cross-border tax evasion. The Centre grew to include China, France, Germany, Japan and South Korea.

The FTA’s Multilateral Strategic Plan on Mutual Agreement Procedures: A Vision for Continuous MAP Improvement, which it published today, identifies areas of strategic focus as:

  • resources;

  • empowerment;

  • relationships and posture;

  • process improvements;

  • relationship with audit functions;

  • responsibility and accountability; and

  • modification

The tax chiefs also discussed how they can work with taxpayers, companies and practitioners to encourage stronger voluntary compliance; how they can strengthen tax control frameworks under the guise of cooperative compliance, which describes how tax authorities and taxpayers work together, often before tax returns are filed, to prevent potential areas of conflict from becoming disputes.

The FTA also released four reports covering taxpayers’ use of self-service channels; tax debt management; how to improve tax compliance in the SME sector; and a practical guide to measuring tax compliance outcomes.

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