Archive for OECD

IRS Actively Seeking US Tax Dodgers Abroad!


According to Bloomberg (subscription required) The Department of Justice Tax Division is ramping up an intense crackdown on offshore tax evasion, and people hiding assets overseas should come forward as soon as possible, an agency official said March 6, 2015. Caroline D. Ciraolo , principal deputy assistant attorney general for policy and planning at the division said:

“Time is of the essence,”
“Come in now or face the consequences.”

Speaking at the Federal Bar Association Tax Law Conference, Ciraolo said the government’s reach has extended far beyond Switzerland to jurisdictions including: Read more

OECD Announces New Country-by-Country Reporting Standard Starting in 2016!


On 02/06/15 the OECD and G20 countries have agreed three key elements that will enable implementation of the BEPS Project:

• a mandate to launch negotiations on a multilateral instrument to streamline implementation of tax treaty-related BEPS measures;

• an implementation package

     • for country-by-country reporting in 2016 and

     • government-to-government exchange mechanism to start in 2017;

• criteria to assess whether preferential treatment regimes for intellectual property Read more

Panama Re-Examining The OECD’s Automatic Exchange of Information!

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According to the My Panama Lawyer Blog, The Ministry of Foreign Relations of Panama, headed by Vice-President Isabel de Saint Malo posted this communique on its website:

“Panama is in the process of re-evaluating its strategy to meet state requirements for financial transparency and exchange of information at international level, without neglecting national interests.

The Organisation for Economic Co-operation and Development (OECD) has established itself a new international standard for automatic exchange of information . However, its scope, methodology, limitations and other basics have not been defined. In this sense, it is premature for Panama to commit itself until it is fully developed. Read more

The Swiss Government Released Q&A’s On Automatic Exchange of Information

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Friday, October 10, 2014, we posted Swiss Consider Automatic Exchange of Information Pursuant to Model 1 FATCA Agreement! where we discussed that the mandates definitively adopted by the Federal Council are:

1. The introduction of the automatic exchange of information is to be negotiated with the EU.

2. Regarding implementation of the Foreign Account Tax Compliance Act (FATCA), a Model 1 FATCA agreement should be with negotiated with the United States. With the new agreement, data would be exchanged automatically between the competent authorities on a reciprocal basis. Read more

Australian Tax Office BEPS “Progress Report”

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In a speech last week ATO’s Mark Konza, Deputy Commissioner – International, gave an insight into the ATO’s activities in responding to a number of the OECD’s post Cairns G20 Minister’s Conference BEPS Action Plan items.

Deputy Commissioner Konza put particular emphasis on the ATO’s strategy in connection with “Action Item 1: address the tax challenges of the digital economy”. Commenting on the ATO’s work on this aspect he said-

“The broader digital economy is also being addressed through our four-year dedicated compliance program to address International Structuring and Profit Shifting (ISAPS). Tax and law professionals from external firms have been recruited into the ATO to help Read more

Tax Dodgers Beware!

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In an effort to crack down on tax evasion the OECD developed what it calls a “New single global standard for the automatic exchange of information between key authorities worldwide.” The standard was approved by the OECD council on 15 July 2014 and is expected to result in an elimination of the secrecy surrounding some banking transactions as it relates to tax matters.
The new standard has been endorsed by more than 60 countries or jurisdictions including the United States, United Kingdom, European Union and Canada and other major jurisdictions already committed to implementation.

The standard requires detailed account information to be provided to governments by financial institutions. The information obtained from the financial institutions will be Read more

Transfer Pricing: 25% Rule of Thumb Not Applicable To Determining Royalty Rates

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Attached please find a recent U.S. Court of Appeals for the Federal Circuit case (September 16, 2014 in VirnetX, Inc. v. Cisco Sys., Inc.) in which a U.S. court finds again the “25 percent rule of thumb” to determine royalty rates inadmissible:

“[W]e agree with the courts that have rejected invocations of the Nash theorem without sufficiently establishing that the premises of the theorem actually apply to the facts of the case at hand. The use here was just such an inappropriate “rule of thumb.” Previously, damages experts often relied on the “25 percent rule of thumb” in determining a reasonable royalty rate in a hypothetical negotiation. That rule hypothesized that 25% of the value of the infringing product would remain with the patentee, while the remaining 75% would go to the licensee. [W]e held the “25 percent rule of thumb” to be inadmissible Read more

Expatriation Increase At A Record Pace In 2014!

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The number of Americans renouncing U.S. citizenship stayed near an all-time high in the first half of the year before rules that make it harder to hide assets from tax authorities came into force (FATCA – Effective Date July 1, 2014).

On Monday, February 10, 2014, we posted “221% Increase of US Expatriation”   a record number of U.S. taxpayers renounced their citizenship or green cards in 2013, according to new data.

Each quarter the U.S. Treasury publishes the names of the Americans who officially expatriated during that period.

The number of Americans renouncing U.S. citizenship stayed near an all-time high in the Read more

IRS To Unveil Compliance Program For U.S. Expats Not Willfully Evading Taxes?

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U.S. citizens abroad who are noncompliant with their tax obligations but aren’t willfully evading taxes may be able to come into compliance under a new program to be announced by the Internal Revenue Service.

According to prepared Remarks of John A. Koskinen Commissioner Internal Revenue Service Before The U.S. Council For International Business-OECD International Tax Conference on Washington, D.C. June 3, 2014:

“Now, while the 2012 OVDP and its predecessors have operated successfully, we are currently considering making further program modifications to accomplish even more.

We are considering whether our voluntary programs have been too focused on those Read more

47 Countries Declare GATCA Adoption

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GATCA Declaration

47 countries and major financial centers on May 6, 2014 declared am automatic exchange of information between their jurisdictions, announced the OECD.  All 34 OECD member countries, as well as Argentina, Brazil, China, Colombia, Costa Rica, India, Indonesia, Latvia, Lithuania, Malaysia, Saudi Arabia, Singapore and South Africa endorsed the Declaration on Automatic Exchange of Information in Tax Matters that was released at the May 6-7, 2014 Meeting of the OECD at a Ministerial Level.

The Declaration commits countries to implement a new single global standard on automatic exchange of information (“GATCA”).  The OECD stated that it will deliver a Read more

Swiss Account Holders – Losing The Right To Be Informed About IRS Disclosure

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The Swiss continue to cave in and erode any bastion of bank secrecy within its picture perfect borders. The Swiss Parliament voted on March 6, 2014 to turn over information to foreign governments on certain account holders with undeclared accounts in Swiss financial institutions without providing the holders any advance notice of the disclosure. The move was in reaction to the 2011 admonishment to Switzerland by the Global Forum on Transparency and Exchange of Information for Tax Purposes to take measures to increase its tax transparency. If Switzerland took no action, it risked being placed on a global blacklist. The Global Forum is a division of the Organization of Economic Co-operation and Development (commonly referred to as “OECD”). We understand that the amendment must be finally approved at the end of the current Swiss legislative Read more

BEPS And Transfer Pricing

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The news headlines that many multinational companies (MNCs) have been reducing their income tax burden through shifting of income to no- or low-tax countries have resulted in the OEC’s Action Plan on addressing Base Erosion and Profit Shifting (BEPS). The BEPS action plan is very aggressive and comprehensive.

Major countries including China, India and the US are actively involved in the BEPS project.

MNCs are challenged with getting ready for potential regulatory changes that may happen soon to impact their existing tax planning structures that they put in place a few years ago.

Major Goals of BEPS Read more