Saint-Amans: greater co-operation the only way to maintain tax sovereignty
Tax sovereignty is incompatible with the globalised world, according to OECD tax policy director Pascal Saint-Amans
Speaking at the Public Accounts Committee’s Global Tax Transparency Summit, Saint-Amans told told ministers, tax professionals and international representatives ‘a gap’ still exists ‘between the world globalising and tax sovereignty’.
‘As members of parliament, you don’t want to give up any part of your sovereignty, except that with globalisation, sovereignty became purely nominal and not real. Actually, it took the [financial] crisis for countries to realise that to ensure their sovereignty be preserved, they had to co-operate and give up a part of it through tax co-operation.’
Despite that progress, Saint-Amans expressed concerns that measures such as country-by-country reporting must become fully public to be most effective.
‘Country-by-country reporting is going to happen through exchange of information between tax administrations. My job is to make sure we secure the information for tax administrations. We had some reluctance from some key countries to move towards publicity. The US, Japan and some others. The deal which was reached was that it would be great if it was public, but what I care about is that the tax administrations get it.’
He added the US and Japan had some ‘good and bad reasons’ to oppose publicity, the good including competition and risk, while he identified ‘wanting to avoid public pressure’ as a bad reason.
Tax Justice UK chief executive Alex Cobham added his voice to the call for publicity, claiming progress on tax transparency must be fully public ‘if it is to effectively hold authorities and tax avoiders to account’.
He added he hoped to see country-by-country reporting become publicly available in the near future, noting that ‘automatic exchange of information, country-by-country reporting were once seen as utopian. Now these are mainstream ideas’.