Friday, August 17, 2012

OECD Insight Blog: Tax paying made easier

How do you spell it?

In a telling sign of how the general line of thinking might be travelling our way, the OECD Insight Blog is carrying a blog about automatic information exchange, which the OECD recently conceded is an effective tool for tackling tax evasion.   Titled Tax paying made easier, the blog opens with a quirkily spun story about how cross-border information flows sometimes just don't work, in this instance concerning the case of Prawo Jazdy, surely one of Poland's worst drivers ever, terrorising the streets of Ireland:

"Prawo Jazdy was the most reckless driver Ireland had ever known, travelling at unlawfully high speed around the country, pausing only to park illegally. And yet despite getting caught innumerable times, he avoided prosecution simply by changing address. Then one day a particularly gifted member of the Garda began to wonder if it all might not be a hideous mistake and looked up the Polish bandit’s name, not in the Interpol database, but a dictionary. Imagine his surprise when, as the Irish Times relates, he learned that Prawo Jazdy means “driving license”. Case solved."

The blog also picks up on points we have previously covered, including Denmark's lead position as the country making most effective use of automatic information exchange to tackle evasion, and notes that "EU experience with the Savings Directive suggests that without automatic information exchange, over three-quarters of taxpayers may not have complied with their tax obligations in their country of residence."

We are also pleased to see the blog citing our own research into the Price of Offshore:

"The Tax Justice Network estimates that individuals hold about $21 trillion of unreported wealth offshore, the equivalent of the combined GDP of the US and Japan. They think the figure may be even higher ($32 trillion) but even a previous, far lower estimate of $11 trillion still represents around $250 billion dollars in lost tax revenue each year – five times what the World Bank calculated was needed to address the UN Millennium Development Goal of halving world poverty by 2015. The usual term for these places offering low or zero taxes is tax haven, but TJN thinks that “secrecy jurisdiction” is a better description, since they provide facilities to get around the rules of other jurisdictions using secrecy as their prime tool."

After so many years of promoting automatic information exchange as the effective global standard, it is gratifying to read such support on OECD Insight.  Read the full blog, and drive safely.


Blogger Physiocrat said...

Where is all this 21 trillions of offshore wealth and what does it actually consist of?

3:04 am  

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