On 16 September 2021 the Global Forum on Transparency and Exchange of Information for Tax Purposes, the World Bank Group and the African Development Bank issued a new version of the Manual on Exchange of Information.

The previous version of the manual, issued in 2013, by the Global Forum and the World Bank Group, set out issues relating to exchange of information on request and spontaneous exchange of information. The range of tools for exchange of information has been expanded in the new edition of the manual and now includes simultaneous tax examinations and tax examinations abroad.

Simultaneous tax examination (STE)

A simultaneous tax examination permits two or more jurisdictions to carry out simultaneous tax audits of persons of interest to both countries. Each country conducts the examination from its own territory, but relevant information gained from the audit is exchanged with other countries.

An STE co ordinator who has competent authority status would be appointed in the exchange of information (EOI) unit. The STE co ordinator would serve as the first point of contact for internal enquires or for enquiries from foreign tax administrations, and would coordinate the STEs, maintaining communication with foreign STE co ordinators and with national tax auditors. The STE coordinator would promote STEs within the tax administration and organise training for tax auditors.

Tax examination abroad

A tax examination abroad (TEA) would permit representatives of the competent authority of one jurisdiction to be present during the relevant part of a tax examination in the foreign jurisdiction, with the permission of the foreign competent authority. The competent authority of the foreign jurisdiction would still be responsible for decisions on the tax examination such as the time and place of the examination, the officials carrying out the examination and the procedures to be followed. The foreign tax administration is not however obliged to accept the presence of a foreign tax auditor.

Before a TEA is requested, internal procedures and the usual exchange of information request (EOIR) process should be exhausted, otherwise there may be an unnecessary burden for the foreign jurisdiction. The request for a TEA should therefore be made after a previous EOIR by the requesting jurisdiction, or the receipt of a spontaneous exchange of information (SEOI).

In some countries, only passive participation of foreign tax officials in a tax examination would be permitted. In this case the participation by foreign tax officials would only involve observing the relevant parts of the tax examination and liaising directly with the tax officials of the other country. The foreign tax officials would not in this case be allowed to interview taxpayers or other individuals.

Other countries may allow active participation in the tax audit by the authorised foreign tax officials. In this case some countries may permit foreign tax officials to carry out interviews and examine records relating to the taxpayers under audit.

The latest edition of the model manual contains checklists and template letters covering the main types of communication carried out by EOI units.