ACCA (the Association of Chartered Certified Accountants) welcomes today’s publication of the European Commission’s communication on concrete ways to improve the fight against tax fraud and tax evasion including in relation to third countries - those outside the EU.
For ACCA, the communication rightly insists on how to better use existing instruments in order to promote tax compliance and tackle fraud and evasion. Many of the approaches raised in the communication are common sense and should be welcome. However, ACCA warns against potential implementation difficulties.
Chas Roy-Chowdhury, head of taxation at ACCA says: 'Enhancing the exchange of information among the tax administrations in different Member States is instrumental. We therefore agree with the Commission’s proposal to improve the identification of taxpayers and to conduct an impact assessment on the creation of a European tax identification number (TIN). That said, the difficulty lies in the fact that each Member State has its own system. This means that their IT architecture, hardware and software may be configured in such a way that they could not handle such a change without requiring expensive modernisation of their systems.'
'In the same vein, the proposal to consider a minimum common level of sanctions against tax fraudsters and evaders is tempting, but again, the way in which different taxes are implemented in the various Member States will make this difficult as well,' Chas Roy-Chowdhury adds.
ACCA also welcomes the third pillar of the communication relating to how to coherently deal with third countries and tax havens located outside the EU.
Given the organisation’s global outreach, ACCA strongly agrees that there is a need to push at global level for the development and the implementation of standards equivalent to EU standards. ACCA also endorses the proposal to build an EU favourable tax environment where erosion of tax bases is efficiently tackled, and believe that all jurisdictions should pull together and not help facilitate tax evasion.
'We should not allow the focus on offshore jurisdictions to become an excuse for failed compliance policies by EU countries. We need co-ordinated measures proposing both defensive instruments and incentives to fight against unfair practices. ACCA thus looks forward to the publication of the announced EU Action Plan, foreseen by the end of 2012, that will explore more stringent rules on tax havens,' Chas Roy-Chowdhury concludes.