Finance ministers of the G20 countries have agreed to begin the general automatic exchange of tax information by the end of 2015.
In a communique issued after their weekend meeting in Sydney, they requested all jurisdictions to follow suit and adopt the OECD protocol on information exchange if they are able to.
The communique also threatened ‘tougher incentives’ for jurisdictions that have failed their OECD tax transparency evaluations.
Some 14 jurisdictions have not been permitted to progress to phase 2 of the OECD peer reviews, meaning that their banking secrecy laws do not permit foreign tax authorities to request disclosure of accountholder information.
The use of the word ‘incentive’ in the G20 communique suggests that financial sanctions may be on the way for these jurisdictions.
• The G20 leaders also committed to the OECD’s plan to counter profit shifting by multinational companies. Practical measures affecting all industries, not just the ‘digital economy’, are expected to come into effect by the G20 Brisbane summit in September. Completion of the so-called Base Erosion and Profit Shifting project is scheduled for the end of 2015.