Brussels, 01/06/2016 (Agence Europe) - There are limits to what the OECD can do in the fight against tax evasion and tax optimisation, explained Alex Cobham, Director of Research of the Tax Justice Network, at a conference on Wednesday 1 June organised by the S&D group at the European Parliament.
Stressing that the OECD is an instrument of government, he joked that after the Panama Papers scandal broke, representatives of the Paris-based institution said that Panama was the last big financial centre not to have subscribed to the global standard on the automatic exchange of information. “This is laughably not true, the United States has refused to sign up to that instrument, but it's hard for the OECD to come out and say that”, Cobham continued. The USA implement its own bilateral 'FATCA' agreements, which still make no provision for reciprocity in the exchange of information, but which threaten any jurisdiction which is reluctant to apply withholding taxes, Cobham explained. The EU should also consider withholding tax, he added. “We need to be realistic about what the OECD itself can deliver”, he concluded. On behalf of the network Eurodad, Tove Maria Ryding explained that with certain aspects of its 'BEPS' action plan to fight tax optimisation, the OECD has not been entirely helpful. She referred to the example of 'patent boxes', tax regimes favourable to intellectual property. The OECD has decided not to prohibit them and has therefore defined an approach to allow these regimes to meet the standards. Since this approach was approved by the OECD, more and more countries are introducing patent boxes, Ms Ryding said. On behalf of the OECD, Grace Perez Navarro pointed out that the Paris-based institution had already said that it felt that these regimes were not the best tool to encourage investment. However, as certain countries are introducing them, the OECD decided to define the outlines of these regimes “to ensure they do not harm other countries”.
In the wake of the Panama Papers scandal, the G20 gave the OECD mandate to lay down the criteria for July to identify non-cooperative jurisdictions regarding “fiscal transparency”. The European Commission, which is working in parallel on a European list, has stated that it would support an international blacklist if it was “robust enough to have a real effect and [if it was] fully implemented internationally”. The European list must remain the priority, according to the Commission (see EUROPE 11545). (Original version in French by Élodie Lamer)