OECD Seeks To Prevent Common Reporting Standard Avoidance

The OECD has launched a disclosure facility allowing the reporting of potential schemes to circumvent the Common Reporting Standard, the new international standard for the automatic exchange of financial account information in tax matters.

The facility is part of a wider three-step process the OECD has put in place to deal with schemes that purport to avoid reporting under the Standard. As part of this process, the OECD says that all actual or perceived loopholes that are identified will be systematically analyzed to arrive at appropriate courses of action.

The OECD’s actions further strengthen the Standard, which by design already limits opportunities for taxpayers to circumvent reporting. The Standard has a wide scope in terms of the financial institutions required to report, the financial information to be reported, and the scope of account holders subject to reporting. It also requires jurisdictions, as part of their effective implementation of the Standard, to put in place anti-abuse rules to prevent any practices intended to circumvent the reporting and due diligence procedures.

Further information on the new facility is available on the OECD’s website. Disclosures can be made online through the OECD’s “Automatic Exchange Portal.”