Brexit & EconomyPoliticsEvasion crackdown singles out investment banks

Evasion crackdown singles out investment banks

Super-rich the subject of focus from global tax authorities

Global investment banks will be a key focus for tax administrations in the
international push to stamp out tax avoidance and evasion.

The spotlight on high net worth individual clients within these banks was
outlined by a gathering of global tax heads, including those from Australia, UK
and South Africa, at an OECD forum in Paris last week.

Dave Hartnett, permanent secretary for tax at HM Revenue and Customs, said
Swiss banks with HNW individuals as clients are particularly susceptible to the
sweeping crackdown.

‘There is no doubt we differentiate between types of banks that have in the
past been big risk takers and posed a big risk to tax administrations,’ he said.

He did, however, concede the relationship between tax administrations and
banks is changing, with as many as eight global investment banks assisting in an
OECD study to identify the markers of riskier institutions.

‘We’ve seen clear indications of this relationship improving. We’re spending
an increasing amount of time in the boardroom with banks…there are positive
indications. If I can be very bold, banks have learnt a lesson in the last 12
months,’ he said.

According to Michael D’Ascenzo, commissioner of taxation for Australia, banks
that use more structured finance techniques are becoming increasingly aware of
the downside risks to an aggressive approach.

‘We’re going to be looking at the risk profiles of these banks and the
behaviour they show and we’ll be paying more attention to these,’ he said.

Further Reading:

OECD
removes last three jurisdictions from tax ‘blacklist’

Brown
feels tax haven pressure from Commonwealth

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