Vietnam joins Multilateral Convention to tackle tax evasion and avoidance
Paris (VNA) – The Organisation for Economic Cooperation and Development
(OECD) and Vietnam on March 22 signed the world’s most wide-reaching international
treaty for multilateral tax cooperation, the Multilateral Convention on Mutual
Administrative Assistance in Tax Matters (MAAC), bringing the total number of
jurisdictions that participate in the convention to 147.
With
the signing, Vietnam joins international efforts towards greater tax
cooperation and exchange of information and further strengthens the reach of
the convention in Asia. The signing will pave the way for Vietnam to engage in
the exchange of information with 146 other jurisdictions, including all major
financial centres. These exchange relationships will be added to over 8,000
exchange relationships already in place under the convention.
The
convention enables the jurisdictions to engage in a wide range of mutual assistance
in tax matters: exchange of request information, spontaneous exchange,
automatic exchange, tax examinations abroad, simultaneous tax examinations, and
assistance in tax collection. It guarantees extensive safeguards for the
protection of taxpayers' rights.
The convention is the primary instrument for the swift implementation of the Standard for the Automatic Exchange of Financial Account Information in
Tax Matters (Common
Reporting Standard - CRS). The CRS – developed by the OECD and G20 countries –
enables more than 110 jurisdictions to automatically exchange offshore
financial account information.
Beyond
the exchange of information on request and the automatic exchange according to
the standard, the convention is also a powerful tool in the fight against
illicit financial flows and is a key instrument for the implementation of the
transparency standards within the work of the OECD/G20
Inclusive Framework on Base Erosion and Profit Shifting (BEPS).
OECD
Deputy Secretary-General Yoshiki Takeuchi welcomed Vietnam’s participation in the MAAC, saying that this showed the country’s determination to prevent tax evasion abroad, move
towards tax transparency, and deal with illegal financial flows.
According to
Takeuchi, Vietnam's move, following its decision to join the Global Forum on
Transparency and Exchange of Information for Tax Purposes in December 2019,
demonstrated Vietnam's commitment to global tax transparency.
Deputy General Director of the General Department of Taxation Dang Ngoc Minh said that in the
coming time, Vietnam will step up the building of information infrastructure to exchange
and exploit information from other countries, especially information of
foreigners and transnational corporations./.