OECD: involve civil society and developing countries in peer review process
The OECD is imminently starting its peer review process to examine the progress that secrecy jurisdictions have made towards implementing effective tax information exchange. The review process is headed by François D'Aubert (France), supported by appointed representatives of India, Japan, Jersey and Singapore.
In the following letter to Michael Rawstron, chair of the OECD's Global Forum on Transparency and Exchange of Information for Tax Purposes, a widely based civil society coalition calls for a number of measures to strengthen the review process, not least the inclusion of civil society and a wider range of developing countries in the review process, and for disclosure of its outputs:
Chair, Global Forum on Transparency and Exchange of Information for Tax Purposes
International Tax and Treaties Division
Australian Federal Treasury
Parkes ACT 2006
9 February 2010
Civil society and developing country participation in the peer review process
Dear Mr Rawstron,
We are writing in advance of the meeting of the Steering Group of the Global Forum on Transparency and Exchange of Information for Tax Purposes in
We welcome the OECD's awareness that developing countries have so far not profited from international cooperation in tax information exchange and that more needs to be done in this respect. We also welcome the increasing openness of OECD staff towards the role of automatic information exchange within an effective model of tax cooperation.
In a letter addressed to Angel Gurria we highlighted the importance of civil society and developing country participation in OECD work to develop a standard on country-by-country reporting. We also circulated a policy statement which sets out our priorities for the OECD in 2010.
In that policy statement, we called for emerging standards for tax cooperation with developing countries to become part of the international standard against which the Global Forum’s Peer Review Group assesses jurisdictions. We are concerned that no commitment has been made so far in this respect. As Art. 38 of the Outcome Document of the Conference on the World Financial and Economic Crisis and its impact on Development states: "Inclusive and cooperative frameworks should ensure the involvement and equal treatment of all jurisdictions. We call for consistent and non-discriminatory implementation of transparency requirements and international standards for exchange of information." The OECD and the Global Forum should work towards this aim by fully including developing countries in the peer review process.
Therefore, we call for the Global Forum’s steering group to agree to the inclusion of specific monitoring indicators regarding exchange of information with developing countries as part of the peer review process. Progress reports should address participation in new mutilateral agreements for information exchange, as well as the number and the implementation of Double Taxation Agreements (DTAs) and Tax Information Exchange Agreements (TIEAS) with all developing countries, including low income countries. The peer review should eventually identify the obstacles to developing countries making full use of these arrangements and the steps which Global Forum members can take to help overcome them. Financial and technical support to developing country tax authorities, and the automatic exchange of certain tax information to complement exchange on request, should form part of these considerations.
Civil society has advocated multilateral solutions in part because we are concerned that the negotiation by developing countries of new DTAs and the renegotiation of existing DTAs to include Art. 26 might be accompanied by pressure for a further switch from source taxation on dividends and royalty payments to residence taxation. As developing countries are usually capital importers vis-a-vis developed countries, this would be to the detriment of their efforts to mobilise domestic resources for development finance. We therefore call for the Peer Review Group to take a close look at changes of source taxation provisions in new and revised DTAs in their progress reports.
We welcome the new OECD task force on tax and development as an important step. However, civil society organisations (CSO) and developing country participation in this informal body is not a substitute for a broad involvement of these stakeholders in the official Global Forum peer review process. Substantial CSO and developing country government involvement in the peer review process is imperative to ensure confidence in it from all stakeholders. We note that existing peer review processes, such as that for the OECD Anti-Bribery Convention and the DAC, could serve as an example to build on; however, civil
society participation in the process of peer review itself must be mandatory.
Finally, we call for the public disclosure of all documented outputs of the peer review process and a multi-criteria public rating to be published annually to enable CSOs and media to monitor progress towards effective information sharing. This public rating should have appropriate criteria to measure the degree of opacity and the efforts made by each jurisdiction. Such a public multicriteria rating could eventually be used in other forums as a tool to implement coordinated counter-measures against non-cooperative jurisdictions. In this regard, we call on the steering group to take into account the Financial Secrecy Index criteria developed by CSOs.
Richard Miller, Executive Director
Action Solidarité Tiers Monde, Luxembourg
Richard Graf, President
Peter Niggli, Director
CCFD-Terre Solidaire, France
Ms. Catherine Gaudard, Head of Advocacy
Dr Daleep Mukarji, Director
Margaret Boden, Chief Executive
Bernd Nilles, Secretary General
Arnaud Zacharie, Secretary General
CRBM / Mani Tese,
Antonio Tricarico, Coordinator
Debt and Development
Nessa Ní Chasaide - Coordinator
Eurodad – European Network on Debt and Development
Nuria Molina, Director
Raymond Baker, Director
Ariane Arpa, Executive Director
Adele Webb, National Coordinator
KOO- Koordinierungsstelle der Österr. Bischofskonferenz
Prof. Dr. Josef Sayer, Chief Executive Director
Wenche Fone, Director of Development Policy
Oxfam France – Agir Ici
Luc Lamprière, Chief executive
Plate-forme paradis fiscaux et judiciaries, France
Jean Merckaert, Coordinator
Revenue Watch Institute
Karin Lissakers, Director
Tax Justice Network International
John Christensen, Director
Rudy Demeyer, Director
Anthony Gooch, Director of Public Affairs & Communications
Paulo Ciocca, Chair, OECD Committee on Fiscal Affairs
Eckhard Deutscher, Chair, OECD Development Assistance Committee
Francois D’ Aubert, Chair, Peer Review Group of the Global Forum on Transparency and Exchange of Information
Jeffrey Owens, Director, OECD Centre for Tax Policy & Administration
Pascal St Amans, Head of the Global Tax Forum Secretariat