TAX NEWS - JUNE 2010

Home > Tax News > June 2010

Go to Tax Rates Home Page

OECD Tax: Fifteen countries sign protocol to 1988 information exchange convention

On 27 May 2010, 15 countries signed a protocol amending the 1988 Convention on Mutual Administrative Assistance in Tax Matters. The protocol was jointly opened for signature by the OECD and the Council of Europe on this date and is intended to modernize the 1988 Convention by aligning it with current international standards (i.e. article 26 of the OECD Model Tax Treaty). Of the 15 countries, Denmark, Finland, Iceland, Italy, France, Netherlands, Norway, Sweden, Ukraine, the U.K. and the U.S. were signatories to the original agreement. The new signatories are South Korea, Mexico, Portugal and Slovenia.

Among the protocol's amendments to the 1988 Convention are provisions:

- To allow full information exchange in tax matters without regard to whether the country receiving the request has a domestic tax interest and without regard to bank secrecy laws; and

- To permit, after initial ratification (discussed separately below), countries that are not OECD or Council of Europe members to become parties to the Convention by unanimous consent of the existing parties.

The protocol is subject to ratification and the party must have previously or simultaneously ratified the 1988 Convention. At least five signatories must ratify (with instruments of ratification properly deposited) the protocol for it to enter into force. Such initial entry into force with respect to those parties will occur on the first day of the month following the expiration of a period of three months after the date the minimum five ratifications have been deposited. Later-ratifying parties are subject to the same wait period as from the date of their deposit of the necessary ratification instruments. Except for criminal tax matters, the protocol will then have effect for taxable periods beginning on or after 1 January of the year following entry into force with respect to any particular country (or, where there is no taxable period, for charges to tax on or after 1 January of such year). Parties may mutually agree to earlier application. For criminal tax matters, the protocol takes effect as from the date of entry into force and may be applied for earlier taxable periods or charges to tax. Other signatories to the 1988 Convention for which the Convention is in effect are Azerbaijan, Belgium and Poland.

Canada, Germany and Spain have also signed the 1988 Convention but it is not in effect with respect to those countries.
Tax

© 2009-2012 TaxRates.cc
2011 - 2012 Tax Rate Guide and Tax Help Website

Tax Rates
Tax Rates
Global Average Tax Rates
Historical Tax Rates
Tax News
Tax Videos
Tax Articles
IRS Tax Forms
Tax