The global accountancy body supports in particular the priority given on promoting and broadening the scope of the automatic exchange of information between tax administrations at the EU and global levels. In that vein, we look forward to the forthcoming European Commission proposal - expected for June - to amend the Savings Taxation directive in order to extend, as from 2015, the total tax transparency requirement on member states to dividends, royalties and capital gains.
Chas Roy-Chowdhury, head of taxation at ACCA says: 'There has probably never before been a time when so much political capital has been invested in this issue. Progress on automatic exchange of information in the area of taxation of savings would be a very significant step, given that the issue has been discussed for many years but unanimous agreement has been impossible so far. If the IT arrangements can be sorted, the automatic exchange system has the potential to work quite effectively.'
'ACCA also welcomes the call from EU leaders for quick agreement on the package of measures aiming to strengthen the fight against VAT fraud entailing the EU Directives on the quick reaction mechanism and on the reverse charge mechanisms. Similarly it would be useful, as a complementary measure, to strengthen the Code of Conduct on business taxation,' Chas Roy-Chowdhury adds.
On another note also addressed by EU leaders, John Davies, head of technical at ACCA points out: 'The European Commission is right to pursue a co-ordinated approach to the regulation of financial crime. Tax offences are likely to constitute a significant element of money laundering activity in most countries, and it makes sense for offences in that area to come within the scope of the revised directive on money laundering. This will mean that regulated parties, such as accountants and banks, will be presented with a clear obligation to pass on to the authorities any knowledge or suspicion they have of tax evasion on the part of their clients. We also welcome the EU executive’s renewed commitment to the publication by companies of details of their beneficial ownership: mandatory disclosure by companies of this information will make it much easier for regulated parties to fulfil their responsibilities.'
'In a globalised world, it is not enough to confine our thinking to Europe. We also need to address the challenges of taxation in the digital economy. We therefore look forward to the publication of the results of the OECD Initiative on base erosion and profit shifting, as we believe this should pave the way towards a fairer approach to taxation.
'It is vital that we find solutions to many of the long-standing technical elements of international tax law which have not kept pace with changes in technology and corporate mobility, and have led directly to many of the concerns about the accountability of multi-national companies. We cannot turn back the clock on how business is conducted but we can modernise the law to make sure that the principles of tax are properly applied in the changed circumstances. We therefore need meaningful improvement to solve the problems of the digital age. This will not be an easy task since there are likely to be winners and losers but the project is a crucial one,' Chas Roy-Chowdhury concludes.