India demands automatic information exchange
India's prime minister Manmohan Singh yesterday asked that the G20 would take the lead on introducing automatic information exchange: and heralded a new era of international financial relationships. He said:
"The G20 countries should take the lead in agreeing to automatic exchange of tax related information with each other, irrespective of artificial distinctions such as past or present, for tax evasion or tax fraud, in the spirit of our London Summit that 'the era of bank secrecy is over'."Excellent. Perhaps this background paper did a little job in helping promote this agenda - last month it was handed over to an Indian official, not to mention the work of our colleagues in India who have been pushing for automatic information exchange as the appropriate and effective international standard.
In any case, the bargaining over the details will be starting now - what international organisation can accompany this broader endeavour? Can the existing UN Committee of Experts carry this forward, or will an international tax organisation see the light of the day? Will a new system be developed, or will FATCA or the EUSTD be the model? Most importantly: which advocacy groups will be allowed at the table?
As the loophole-ridden bilateral deals with Switzerland exemplified, the biggest chunk of work is still before us, as the devil will be lurking in the details. But this work surely now will flow more easily.