IRELAND has been up to signing a global tax agreement along with about 12 other countries which is designed to eliminate the banking concealment and handle international tax escape.
The finance ministers belongs to 50 different countries assembled in Berlin the previous day with about more than 30 of them agreeing on the suggested points, including Michael Noonan, signed a pact giving permission for the automated exchange of tax information.
On the basis of the agreement, banks who are dealing with foreign customers will be obliged to forward all the details to tax authorities, which after receiving the details will move the information on to the different national authorities in the custom based countries.
“Banking secrecy has now become ancient in its old form and is fading away,” said by German Finance Minister Wolfgang Schaeuble.
Mr. Schaeuble, who was the host of the Global Forum on Transparency and Exchange of Information for Tax Purposes meeting in the capital of Germany, said banking concealment has no longer been suitable when people have the luxury to “transfer their money throughout the world by simply pressing a button through the internet”.
The press conference was held yesterday afternoon where the Ministers from the UK, Spain, Germany, France, and Italy submitted the agreement.
There are more than 40 countries who have agreed to embrace the standards initiating in 2017.
Other countries like Switzerland, Brazil, Canada, China, Hong Kong, Monaco and Russia promised to initiate the process in 2018.it was said by the Revenue Commissioner yesterday that the banks will be obliged to prepare due diligence by the beginning of 2016 and the first exchange of information will start to happen from January 2017.
According to the agreement, information about the foreign customers interchanged between a bank and tax authorities will contain the detailed account of the interests or the dividends attained in addition to the account balances and the proceedings of sales from any financial assets, according to the German finance ministry.
“it is certainly the starting to end the bank concealment,’ Pascal Saint-Amans, who is the head for the center of Organization for Economic Cooperation and Development for the tax policy and administration, told financial news service, Bloomberg.
It is the recent advancement by the global community to clinch down on the strategy of tax avoidance after the US is the latest move by the global community to clamp down on tax avoidance strategies, after the US chased the banks like the Credit Suisse for the help of the Americans who are cheating on the taxes.
There is also a cooperative international shift to close tax avoidance loopholes by the multinational companies, with the leading of the initiative by the OECD through the Base Erosion and Profit Shifting Project (BEPS), and here the government has given the orders for the disclosure of the supposed Double Irish among the International pressure.
The US FATCA (Foreign Account Tax Compliant Act) in the year 2010 is the pattern for the automatic exchange which restricts the requirements for reporting of non-US financial accounts.
The biggest 5 source of economies for EU are Germany, France, the UK, Italy and Spain and last year they have made an agreement to interchange data among themselves along the lines mentioned by FATCA.
Germany has assisted in leading the push against bank concealment, prompt issues with Switzerland which is not a member of EU.