New proposals to enable the exchange of tax information between the UK Inland Revenue and overseas authorities were announced today by the Chancellor, Gordon Brown.
Tax Information Exchange Agreements will allow the Inland Revenue to receive information about foreign transactions of UK taxpayers and multinational companies not currently available because there is no agreement for effective exchange of information in place.
The Government of Bermuda, one of the UK’s Overseas Territories, has already indicated that it is prepared to enter into negotiations with the UK on such an agreement.
Tax Information Exchange Agreements will allow the Inland Revenue to receive information about foreign transactions of UK taxpayers and multinational companies not currently available because there is no agreement for effective exchange of information in place. The Government intends to open talks with other countries including the UK’s own Overseas Territories and Crown Dependencies as part of its efforts to develop new international standards on exchange of information in support of OECD and G7 initiatives.
NOTES FOR EDITORS
1. The Inland Revenue is already able to exchange some tax information with other countries with which the UK has a double taxation agreement. Information received under those arrangements has assisted in the recovery of millions of pounds in UK tax revenues. Tax Information Exchange Agreements offer a route for exchange of information to be significantly extended and improved.
2. The UK Government strongly supports the efforts of the Organisation for Economic Co-operation and Development (OECD) to tackle harmful tax competition between states. The UK government is encouraging the UK Overseas Territories and the Crown Dependencies to enter into effective exchange of information agreements as an important signal of their willingness to co-operate internationally in dealing with tax evasion and avoidance.
3. The Government has repeatedly emphasised the need for greater international co-operation in particular exchange of information to tackle financial crime, harmful tax competition, tax evasion and avoidance. A G7 initiative seeking to improve the supply of information by the negotiation of effective information exchange agreements was launched by the Chancellor during the UK Presidency in 1998. The Government has also recently circulated a paper (“Exchange of Information and the draft Directive on Taxation of Savings”) which sets out the case for tackling evasion of tax on savings income through exchange of information on a wide international basis. The paper can be accessed from HM Treasury’s web site http://www.hm-treasury.gov.uk.
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