Canada Signs Multilateral Competent Authority Agreement
Canada’s Revenue Minister, Kerry-Lynne D Findlay, has signed the Multilateral Competent Authority Agreement (MCAA) on the Automatic Exchange of Financial Account Information.
The adoption of the MCAA is a commitment from Canada to implement new international standards on the automatic exchange of information in tax matters.
The MCAA specifies the details of what information will be exchanged and when, as set out in the Standard for Automatic Exchange of Financial Information in Tax Matters, developed by the Organisation for Economic Cooperation and Development.
The Canadian Government said that by signing the MCAA, Canada will benefit from a coordinated arrangement for exchanging financial account information efficiently and securely with other jurisdictions.
Under the new standard, foreign tax authorities will provide information to the Canada Revenue Agency (CRA) relating to financial accounts held by Canadian residents. The CRA will, on a reciprocal basis, provide corresponding information. For the CRA to obtain the information to be exchanged, financial institutions in Canada will be required to identify accounts held by non-residents, and report certain information relating to these accounts to the CRA.
Canada has committed to implementing the common reporting standard by 2017. The first exchange of information is scheduled to take place in 2018. Each signatory to the MCAA will maintain complete control over the subsequent automatic exchange relationships they enter into.
Findlay said: “By ensuring an increasing majority of people are playing by the rules, our Government is deepening Canada’s tax base while simultaneously lowering Canadians’ tax burden. The Harper Government has taken over 90 actions to strengthen tax compliance. Through more information sharing and better detection and compliance methods, those who want to evade their tax obligations have no place left to hide.”
“The implementation of the Common Reporting Standard is yet another powerful tool to catch tax evaders. I am pleased to sign the Multilateral Competent Authority Agreement today and expand Canada’s partnerships with like-minded tax jurisdictions.”