Last Friday the OECD Global Forum rated Luxembourg, the British Virgin Islands, Cyprus and the Seychelles as non-compliant with tax transparency standards.
The Tax Justice Network blog has much more, noting for example that these jurisdictions fell “woefully short” of the OECD’s “rather low standards” while Switzerland “failed even to make it past the first stage of a two-stage assessment”.
How have the media in some of these countries reacted to the report so far? In Luxembourg and the British Virgin Islands, mostly by pointing fingers at other jurisdictions and criticising the OECD. The Swiss coverage also has a strong focus on other countries but is relatively more balanced. A brief overview:
Wort.lu reports that the Luxembourg Finance Ministry “had delivered a preemptive strike this week, issuing an official statement ahead of the publication of the report by the Global Forum on Transparency and Exchange of Information for Tax Purposes.”
It also says that “Switzerland fared even worse than the Grand Duchy, being found lacking in adequate laws and regulations. Austria and Turkey meanwhile were found to be only partly-compliant with international standards.”
“The British Virgin Islands, like Luxembourg, criticised the report, saying that it had not taken into account recent reform efforts.”
The pre-emptive statement by the Luxembourg finance ministry had said that the score given to Luxembourg was “excessively harsh,” and that Luxembourg had made a “commitment to exchange information effectively”.
“The ministry pointed out that it receives a high volume of requests for information each year. Over a three year period, it received 832 requests of which 785 were complied, a track record which it considers good given the high volume.”
Neue Zürcher Zeitung : Red cards for Luxembourg and Cyprus
“The Global Forum – linked to the OECD – has evaluated the tax cooperation of 50 countries. Switzerland was not graded due to missing prerequisites.”
“Austria had to settle for a “partially compliant” rating.”
“Several jurisdictions with internationally significant finance centres – US, UK, Hong Kong and Singapore – received the grade “largely compliant”.
“The gaps identified by the Global Forum require several changes in legislation, which the Swiss parliament has not yet dealt with. As a result, Switzerland is at the moment in the illustrious company of Panama, Botswana, Liberia, Nauru, the Marshall Islands and eight other jurisdictions which…are not yet ready for the second phase evaluation of the Global Forum.”
A second NZZ article has the headline Switzerland can breathe out:
“In Jakarta the plenary of the 121 members of the Global Forum ended on Friday. The delegation from Bern rated the fact that Switzerland was not explicitly criticised in the yearly report as a success.”
“Ambassador Fabrice Filliez of the Secretariat for International Financial Matters went further, saying that the advances achieved in order to adapt to international standards had been validated.”
“Switzerland was not included in the country ratings published in Jakarta due to its missing legal frameworks. As a result it was less in the spotlight in comparison with Luxembourg, Cyprus, the Virgin Islands or the Seychelles, which received insufficient grades.”
“The pressure on Switzerland will not diminish, however. The Global Forum is counting on gaps in legislation to be amended.”
(translated from the German with some help from google: corrections and suggestions welcome)
Swissinfo.ch: OECD tax forum complains Swiss making slow progress
“Switzerland has still not met international standards on tax transparency, potentially putting investments at risk, a global tax forum warned Friday in Jakarta.”
British Virgin Islands
BVI news: BVI again described as non-compliant, says the classification is inaccurate
“The British Virgin Islands has again been whipped into damage control mode; this time accusing an overseas group of using outdated data to paint a bad picture of its tax information-sharing mechanism.”
“The Global Forum on Transparency and Exchange of Information for Tax Purposes – its ‘Peer Review Report’ – classified the BVI as non-compliant. But the BVI government said the classification is outdated, and does not accurately reflect the current practices in the BVI since mid-2012. The controversial assessment covered the period from June 2009 to July 2012.”
“Speaking from the Sixth Meeting of the Global Forum in Jakarta, BVI Financial Secretary Neil Smith said it is unfortunate that the Global Forum’s classification “misses the mark”.”
“For a more up-to-date view of the territory’s tax sharing advancements, the BVI government has requested that a supplementary review be conducted as soon as possible. It also expressed confidence that the supplementary review will present what it describes as an accurate and compliant rating of the BVI.”