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Tax Transparency in Asia 2024 is a key output of the Asia Initiative, a regional programme launched in 2021 and focused on developing tailored solutions to ensure the implementation of the global tax transparency standards across Asia.
The report details the work undertaken under the Asia Initiative in 2023 and outlines the progress achieved by its members in the implementation of the standards on transparency and exchange of information on request (EOIR) and automatic exchange of financial account information (AEOI).
It includes numerous figures, case studies and interviews testifying of the impactful results achieved so far in the fight against tax evasion and other illicit financial flows, and the spill-overs for governments and their tax administrations, notably on tax revenue and in support of domestic resource mobilisation.
This is the second edition of an annual series of progress reports, as part of the various efforts to advance transparency and exchange of information for tax purposes in Asia.
EXECUTIVE SUMARY
In 2023, at least EUR 1.8 billion in additional revenue (tax, interest, and penalties) have been identified thanks to exchange of information on request (EOIR) and automatic exchange of financial account information (AEOI), including related-voluntary disclosure programmes and offshore tax investigations.
This brings to at least EUR 21.8 billion the additional tax revenues identified due to EOI since 2009 in Asia.
The level of commitment to the tax transparency agenda remained very high in the region:
- The Philippines added its voice to the work undertaken by the Asia Initiative by endorsing the Bali Declaration and joining the 16 other signatories.
- VietNam became a Party to the Convention on Mutual Administrative Assistance in Tax Matters (MAAC) by signing and ratifying in the same year this powerful multilateral convention that allows all forms of administrative co-operation between tax authorities, including exchange of information in line with the international standard on transparency and exchange of information for tax purposes (tax transparency standards).
- Thailand successfully started its first reciprocal automatic exchanges, meeting its commitment and joining the 14 other Asian Global Forum members which have started AEOI. l Armenia and Mongolia committed to start their first AEOI by 2025 and 2026 respectively, bringing to 18 the number of committed jurisdictions in the region.
- Six Asian Global Forum members committed to work towards swiftly implementing the Crypto Asset Reporting Framework, along with the amendments brought to the Common Reporting Standard in time for exchanges to commence, in principle, by 2027.
In addition, the leadership of the Initiative, its members and partners along with the Secretariat of the Global Forum on Transparency and Exchange of Information for Tax Purposes (Global Forum) continued to raise awareness on the benefits of tax transparency and the participation in the Asia Initiative and reached out to both Asian Global Forum members that have not yet joined the Bali Declaration and non-members of the Global Forum to encourage them to join the tax transparency agenda through the Global Forum and the Asia Initiative.
In 2023, two non-members of the Global Forum, Lao Peope’s Democratic Republic and Tajikistan, participated in the Asia Initiative meetings as observers.
The implementation of the tax transparency standards is progressing in the region with most of the Asian members of the Global Forum building solid EOI infrastructure and obtaining a satisfactory rating in their peer review on EOIR and AEOI.
Those facing challenges to meet a satisfactory rating are closely working with the Global Forum Secretariat to improve their legal framework and/or its implementation in practice to get their current status revisited.
One area where further improvement is recommended is the availability of beneficial ownership information, and therefore capacity building in this matter is a focus for the Global Forum Secretariat.
Asia has benefitted from a strong capacity-building programme, which has contributed to support the effective implementation of the tax transparency standards and their efficient use to mobilise domestic revenue. Acknowledging that further support is required and requested, the Global Forum Secretariat, with the support of its development and technical partners, intensified its offer in 2023:
Over 1 000 officials from the 22 Asian Global Forum members have attended 30 training and sharingexperience events organised by the Global Forum Secretariat, including with partners, on different areas of tax transparency.
- 47% of the Asian participants in capacity-building activities were female officials. l 16 Asian jurisdictions benefited from bilateral technical assistance.
- 17 participants from 8 Asian members of the Global Forum participated in the nine-month Train the Trainer programme. The laureates conducted 16 local training sessions and trained 557 officials from their respective jurisdictions.
- Four women from four Asian Global Forum members successfully participated in the Women Leaders in Tax Transparency programme, which aims at supporting gender equality and promotion of female leadership.
- 21 officials from 7 Asian Global Forum members participated in the Information Security Management Network, aimed at building capacities and sharing experience in this very technical area, which is critical to ensure an appropriate confidentiality and data safeguards framework for EOI
Collaboration with partners has been a major asset to create effective synergies that facilitate the implementation of the tax transparency commitments in the region. Together with the Global Forum, and through coordinated approaches, they have helped to respond to the growing demand for more and more in-depth capacity building and assistance in the region
The Asia Initiative also agreed on its priority complementary actions aimed at supporting interested members in building capacities and skills in other forms of administrative cooperation offered by the MAAC. One key achievement in 2023 was the creation of a Working Group on the Effective Use of Common Reporting Standard (CRS) Data composed of 27 tax experts from 14 Asian members of the Asia Initiative which is mandated to come up with strategy, framework and procedures, as well as tools and methods, for the effective use of the CRS data received.
Despite the significant progress achieved in the region, there is still room for growth and improvement to reach a full and effective implementation and use of the tax transparency standards.
Looking forward and building on the impactful capacity-building programme provided to Asian jurisdictions, the Global Forum Secretariat and the partners will pursue their joint efforts to provide bilateral and multilateral technical assistance, organise trainings and create knowledge tools and e-learning courses to bolster EOI knowledge and skills across the region in all areas relevant for tax transparency.
This strategic direction aims to harness the full potential of tax transparency for revenue mobilisation in Asia and effective tackling of all forms of illicit financial flows.
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