CESI welcomes recent tax transparency developments as a first step towards effective fair tax systems

27 May 2015, keywords :

Reacting to today's successful adoption of an EU-Swiss agreement on the automatic exchange of financial account information, the progress made in the European Commission on its forthcoming Action plan for fairer tax systems as well as the recent news that Amazon will as of now pay taxes on profits made in Germany no longer in Luxembourg but in Germany, CESI notes that these developments are to be welcome but require further follow-up action if the overall objective to establish smoothly running fair taxation systems in Europe is to be realised.

CESI welcomes recent tax transparency developments as a first step towards effective fair tax systems

The EU-Swiss agreement* foresees automatic exchanges of information on the financial accounts of each others residents. It also provides for measures intended to restrict the opportunities for taxpayers to avoid being reported to tax authorities by shifting assets or investing in products that are outside the scope of the agreement. In particular, three central objectives of the taxation agreement are to enable the national tax administrators: 

• to more effectively identify correctly and unequivocally the taxpayers concerned;
• to more easily administer and enforce their tax laws in cross-border situations; and
• to better assess the likelihood of tax evasion being perpetrated.

Agathe Smyth, policy adviser for tax policies at CESI, comments: “The EU-Swiss taxation agreement that was agreed today can be a very powerful tool to help the national tax administrators do their work – collecting due taxes. Now, an unrestricted implementation and enforcement of the agreement by all actors and at all levels is key.” 

CESI represents several major national trade unions of tax administration officers. Especially through its membership in the European Commission’s advisory Platform for Tax Good Governance, CESI has for long called on the EU to take measures that will enable the tax administrators to do their work in an efficient and effective manner.

In this context, CESI also welcomes broader recent developments in the field of tax transparency such as the continuing progress in the Commission towards an Action plan for fairer tax systems in Europe** and Amazon Germany’s recent carving in to political pressure when it comes to paying taxes on profits where they are made. There is still a long way to go on the road to effective fair tax systems, but a good start has been made.

*All information concerning the EU-Swiss taxation agreement can be accessed here.
**More information about the European Commission’s upcoming Action plan for fairer tax systems is available here.