A major focus of the UK’s G8 Presidency was tax transparency and combatting offshore tax evasion. As part of this the UK promoted the development of a new global standard for reciprocal automatic exchange of financial account information in order to effectively tackle the global problem of tax evasion. Due in large part to the UK’s leadership, over 90 countries and jurisdictions have now committed to the new global standard – known as the Common Reporting Standard (CRS) – and will begin automatically exchanging information under the standard by 2017 or 2018. The receipt of large amounts of information on offshore accounts under the CRS will mark a step change in HMRC’s ability to crack down on tax evasion.
During our G8 Presidency, we also drove forward the international work on country-by-country reporting (CBCR), calling on the OECD to develop a template for CBCR reporting as part of the OECD Base Erosion and Profit Shifting (BEPS) project. The OECD template is aimed at providing tax authorities with information on the global allocation of profits and taxes paid and accrued by multinationals, as well as indicators of economic activity in each country. The UK was one of the first countries to commit to implementing the OECD template for CBCR with legislation in the Finance Act 2015.
The final package of measures developed under the BEPS project was published by the OECD on 5 October 2015, and endorsed by G20 Finance Ministers at their meeting on 8 October and the G20 Leaders at their summit on 15-16 November. The UK welcomes the outcomes of the BEPS project and will give full consideration to the OECD’s recommendations.
In addition, the UK has actively supported the revision of the Directive on Administrative Cooperation, to ensure the effective exchange of information about cross-border tax rulings between EU Member States. This directive was agreed in October 2015, and will come into force from 1st of January 2017.