The US and Switzerland have reached an agreement allowing Swiss banks to pay a fine rather than be prosecuted for tax evasion by their US accountholders.
While G20 rhetoric repeatedly trumpets tackling tax evasion as a key action item, events in Syria are likely to dominate proceedings in Russia. Tax will not be sidelined for long, though.
Germany remains concerned about the competitive disadvantage it feels it is being placed under by the existence of European patent box regimes such as the UK Patent Box and the Dutch Innovation Box. German Finance Minister Wolfgang Schaeuble has said that such tax breaks for patents (the UK regime allows for a reduced 10% tax rate for income derived from UK or European patents held in the UK, for instance) do not respect the spirit of EU anti-discriminatory rules.
All G20 nations are now signed up to the OECD’s Multilateral Convention on Mutual Administrative Assistance in Tax Matters after the last remaining outlier, China, signed up this week.
The Indian government has set up a Tax Reform Administration Commission (TARC), tasked with reviewing existing tax policy and recommending measures to improve tax governance. The TARC, which has an 18 month term, will be chaired by Parthasarathi Shome.
