Information Technology Solutions What is it The Convention is a freestanding multilateral - PDF document

M Information Technology Solutions What is it? The Convention is a multilateral treaty designed to promote international co - operation and exchange of information for a better operation of national tax laws, while respecting the fundamental rights of taxpayers. provides for all poss ible form s of administrative co - operation between the parties in the assessment and collection of taxes, in particular with a view to combating tax avoidance and evasion. aultilateral Convention on autual Administr ative Assistance in Tax aatters For more information, www.oecd.org/tax/exchange - of - t ax - information Assistan ce covered E xchange of information (including on request, spontaneous and automatic ), s imultaneous tax examinations, tax examinations abroad, assi stance in recovery and measures of conservancy, and the servic e of documents. It can also facilitate joint audits. Taxe s covered A for customs duties. I t applies to taxes on income, profits, c apital gains, and net wealth levied at the central government level. It also covers local taxes, compulsory social security contributions, estate, inheritance or gift taxes, etc. Rights and safeguards Generally, rights and safeguards under national law rem ain applicable and the Convention expressly recognises a number of limitations to the obligation to provide assistance. Confidentiality V ery high standards of confidentiality and protection of personal data. Co - ordinatin g Body M ade up of representatives of each of the Parties , it monitor s the implementation of the Convention and reviews new countries wishing to join the Convention . Countries , which have signed but not yet ratified the Convention also participate in the meetings of the Co - ordinating Bod y as observers. Flexibility (e.g. local taxes) and the type of assistance to be provided (e.g. assistance in collection) . Reservations can be made at the time of signature or when depositing the instrument of ratification and they can also be made or withdrawn at a later stage. Certain forms of co - operation such as automatic exchange of information and tax examinations abroad require the previous consent of the relevant Part ies. Use of information to combat serious crimes Information obtained under the Convention may be relevant for other purposes such as pursuing (i) such information may be used for such ot her purposes under the laws of the supplying Party and (ii) the competent authority of that Party authorises such use . Flexible Reservation possible on certain issues aultilateral Single legal basis for multi - country co - operation Wide scope Extensive form s of co - operation on all taxes Uniform A Co - ordinating Body ensures a consistent application Key benefits November Questions & AnswersQ: Why should country become Party to the Convention if ialready hnetworof bilateral agreements? The Convention covers a much wider range of taxes than bilateral treaties (e.g., it covers VAT/GST and social security contributions). In addition, the Convention provides the most global, single legal basis for multilateral -operation in tax matters. It is also the legal basis of choice for the automatic exchange of information under the Common Reporting Standard and for Country--Country Reports.Q: Can Party exchange information with another Party under the Convention if their bilateral tax Convention does not provide or Yes.practice,whentwocountriesPartiesboththeConventionandanotherinstrument,the competentauthorityoftheapplicantcountrywillrequestassistanceundertheinstrumentlikelybemost effective,providedofcoursethatthetermsoftherequestmeetthenecessaryrequirementssetassistance to be granted under that instrument (Article 27). Q: nformation obtained nder onvention iven other onvention? Information provided ba Partto anothePartbe transmitted to a third Party, subjecto prior authorisation by the ompetent authority of the arty that provided nformation Article . Q: Can the information obtained under the Convention be given to other authorities, e.genforcement authorities to counteraccorruption, money aundering rrorism financing? Yes, the Convention expressly allows this, subject to certain conditions: information received by a Party may be used for other purposes when (i) such information may be used for such other purposes under the laws of the supplying Party and (ii) the competent authority of that Party authorises such use (Article 22.4). Q: es the convention lotomatic xchange nformation? Yes, It can be established through an administrative agreement between the competent authorities of the Partieswillingprovideeachotherinformationautomatically.Examplesofsuchagreementsthe MultilateralCompetentAuthorityAgreementonAutomaticExchangeofFinancialAccountInformation(CRS MCAA) and the Multilateral Competent Authority Agreement on Country by Country Reporting (CbC MCAA) Q: an a Party eservations? Yesthe Convention allows focertain reservations (e.gtax collection), buis nopossible to make reservations oncerning nly certain arties nvention. Q: an a Party thdraw a reservation at a later e? Yes, Partcan withdraw reservation made at an earlier dateFoinstance Poland withdrew its reservation concerning sistance he ecovery of taxes at the ined uropean ion. Q: ow does the Convention rotect taxpayers’ ights under onvention? The Convention provides that information shall be treated as secret and protected in the receiving State in thesamemannerinformationobtainedunderitsdomesticlaws.If personaldataprovided,theParty receiving them shall treat them in compliance not only with its own domestic law, but also with the safeguards that may be required to ensure data protection under the domestic law of the supplying Party (Article 22). In addition, the Convention provides for an exception to exchanges in case ofordre public concerns that a Party may have in a particular situation. Q: s the role oordinating dy CB)? The CB is responsible fomonitoring the implementation and developmenthe Convention (see Article f the nvention). Q: How is the Coordinating dy CB) inanced? The CB is self-financed body. All signatories make annual and equcontributions to covethe costs othe activities f the historically the ost has een e range 000 to 5 000 EUR per year). jurisdictionsparticipatinginConventionSignatoriesRatification for the complete list. Contact us: CB.MAC@oecd.org aultilateral Convention on autual Administr ative Assistance in Tax aatters Iow to become a party C ountries which are not Members of the OECD or the Council of Europe can becom e a party to the amended Conven tion by following t he procedure set out below : Request to be I nvited to Become a Party Review of the confidentiality framework and d ecision of the Parties to Invite Invitation to Become a Party Signature Ratification, Acceptance or Appr oval Deposit of the Instrument of Ratification, Acceptance or Approval Declarations, Reservations and Notifications Entry into Force