The final communiqué from the G20 summit held in Hangzhou, China on 4 and 5 September 2016 began by noting that although the global economy is recovering from the crisis growth is still relatively weak. New sources for growth are emerging but downside risks remain in the form of financial market volatility; fluctuating commodity prices; sluggish trade and investment and low productivity in some countries. There are also challenges from conflicts, terrorism and refugee flows.

A package of policies and actions referred to as the Hangzhou Consensus is outlined in the communiqué. This aims to catalyze new drivers for growth and new development aims; integration of fiscal, monetary and structural concepts; building an open global economy and inclusive growth that involves in particular women, youth and disadvantaged groups.

The leaders recognize that innovation is a key driver of growth for both individual countries and the global economy. An agenda referred to as the G20 Blueprint on Economic Growth would therefore include policies across the areas of innovation, the new industrial revolution and the digital economy. Structural reforms are important for achieving these policies.

In this context the leaders commented on many of the taxation issues previously discussed by the G20 finance ministers and central bank governors in July 2016. The leaders expressed their support for work towards a fair and modern international tax system; continued cooperation on combating base erosion and profit shifting (BEPS); the exchange of tax information; capacity building for developing countries and tax policies promoting growth and certainty.

On tax transparency the G20 leaders welcomed the implementation of standards on tax transparency. The communiqué called on all jurisdictions to commit to transparency standards, implement the automatic exchange of information by 2018 at the latest and sign the Multilateral Convention on Mutual Administrative Assistance. The OECD is requested to report back to the finance ministers and central bank governors by June 2017 on progress on tax transparency and the country review process. A list should be compiled of jurisdictions that have not adequately complied, in time for the summit of G20 leaders in July 2017 at which time defensive measures will be considered.

In addition to welcoming the inclusive framework that includes developing countries in BEPS implementation the leaders also encouraged support for tax capacity building by international organizations. They welcomed the establishment of the Platform for Collaboration on Taxation that brings together the IMF, OECD, UN and World Bank group for work on tax issues including tax capacity building in developing countries. They also expressed support for the principles of the Addis tax initiative on provision of financial and technical support to developing countries for domestic resource mobilization.

The communiqué emphasized the importance of supply-side structural reform. The leaders requested the OECD to continue its work on pro-growth tax policies and on tax certainty which is important for investment and trade. The importance of policy tools to promote tax reform for innovation and inclusive growth was emphasized and the establishment of an international tax policy research center in China was announced.

The leaders expressed concern at the negative impact of illicit financial flows. Financial transparency is considered essential to prevent corruption, tax evasion, terrorist financing and money laundering. The communiqué emphasized the need for the Financial Action Task Force and the Global Forum to formulate initial proposals by October 2017 on ways improve the implementation of international transparency standards, including exchange of information on beneficial ownership of legal persons.