Offer to work on global information sharing standard

Jersey's Chief Minister has written to the Secretary General of the OECD, offering to work on the development of a global standard for the automatic exchange of tax information:

 

 

I am writing to let you know of Jersey’s wish to be an active participant in the work of the OECD in promoting the global application of automatic exchange of information.  It is assumed that the OECD as the international standard setter will be playing a central role in the pursuit of this goal, which was referred to in the Communique issued following the meeting last month of G20 Finance Ministers. 

 

Jersey has been a very active participant in the work of the Global Forum on Transparency and Exchange of Information for Tax Purposes. As a vice chair of the Peer Review Group Jersey has sought to be closely involved in the work of ensuring global compliance with the existing international standard.

 

It is understood that the OECD is working on developing a single standard for automatic exchange of information, based on the FATCA model, in order to avoid a proliferation of different agreements and Jersey is equally keen to be fully involved in this process.  Jersey has a close affinity with the OECD. Through a Letter of Declaration presented to the OECD by the UK in 1990 Jersey is party to the OECD Convention.

 

Jersey is fully committed to compliance with the existing international standard of transparency and information exchange for tax purposes. This is confirmed by the signing of tax agreements with some 40 jurisdictions to-date. Jersey is close to completing the  negotiation of an intergovernmental agreement with the US on FATCA, the global coverage of which is welcome. Jersey has also agreed to enter into an intergovernmental agreement with the UK which will mirror that with the US, reflecting our special relationship with the UK and a general commitment to join in the fight against tax evasion.

 

Jersey has made it clear that, as automatic exchange of information based on the FATCA model develops into a new international standard, it will commit to compliance with that standard with the same purpose as has been evident to-date in respect of the international standards for taxation, financial regulation and anti-money laundering. 

 

In this respect Jersey also has taken a keen interest in the declared intention of the UK to use the G8 Summit in June to obtain agreement on the formulation of action plans for improving the availability and accessibility of information on beneficial ownership. Jersey is in the forefront (and determined to remain so) of jurisdictions in respect of holding information and the enforcement of rules on beneficial ownership – the World Bank commended the Jersey model in its report entitled the “the Puppet Masters” – and Jersey would welcome the opportunity to share its experience with the OECD, as well as with the G8 and the G20, to assist in the raising of standards globally.

 

Jersey welcomes the recent announcement by the G5 to pilot multi-lateral automatic information exchange based on the FATCA agreements with the USA as an important step in the direction of travel towards a new international standard. Jersey looks forward to hearing the response to this announcement on the part of the European Council when it meets shortly.

 

In particular we are interested in how the G5 pilot will relate to the proposed extension to the scope of the EU Taxation of Savings Income Directive, and the timing of that extension, to which Jersey is committed to respond in accordance with its established good neighbour policy.

 

Jersey is looking to the OECD to determine how automatic exchange of information based on the FATCA model is to be taken forward on a global basis. It is assumed that the OECD will be issuing a statement to this effect which will build on the Multilateral Convention on Mutual Administrative Assistance in Tax Matters which Jersey has indicated it wants to be able to sign in its own right.

 

With this additional information on the way forward we will be better able to consult with our finance industry and present a clearer picture to our legislative Assembly.  Thereby their support can be obtained for our desired active participation in the process whereby  the automatic exchange of information that Jersey has accepted in the intergovernmental agreements being entered into with the US and the UK develops into an international standard gaining global application.

 

From the foregoing it should be clear that Jersey is fully supportive of automatic exchange of information based on the US FATCA model gaining global application as a new international standard. Furthermore, that Jersey wants to be an active participant with the OECD, as the international standard setter,  in the successful pursuit of this objective. We look forward therefore to hearing what are to be the OECD’s proposed next steps and what form it is considered Jersey’s participation might best take.