On 3 May 2022 the OECD published the report Tax Transparency in Latin America 2022. The report was released during a meeting of the Punta del Este Declaration Initiative, which aims to tackle tax evasion and avoidance and other financial crimes by promoting the effective use of exchange of information (EOI) and international transparency standards.
The report covers 16 countries of the Latin America region showing the work done on tax transparency. Progress has been made on the actions agreed by signatories of the Punta del Este Declaration, which include raising political awareness and commitment; strengthening tax administrations; broadening of information exchange networks; increasing the use of EOI; and promoting the wider use of information exchanged through treaties.
During 2021 a new governance framework was implemented for the Punta del Este Declaration and engagement continued at the political level, with Mexico and El Salvador joining the initiative.
Capacity building
The OECD’s Global Forum on Transparency and Exchange of Information for Tax Purposes has engaged in capacity building activities, including tailored programs for seven countries in the region. Five training events were organised during the year and new toolkits and manuals were developed with cooperation from regional partners. Working with regional partners is important to achieve political engagement to promote tax transparency.
Transparency
Countries in the region are sharing their technical knowledge and expertise on exchange of information in the working groups and panels guiding the implementation of the EOI standards. The report indicates that there is progress in implementing the tax transparency standards, but the progress is uneven across the region.
In relation to exchange of information on request, there have been improvements in 2021 as some countries are carrying out strategies to increase the number of information requests they send. It is still the case that most countries in the region are making very few requests and their EOI networks are not being fully used.
The Convention on Mutual Administrative Assistance in Tax Matters is the basis for the exchange of information among the countries in the region, for both exchange of information on request and for purposes of reporting financial account information under the common reporting standard. Further training of tax officials in these areas is however needed.
Beneficial ownership
Progress has also been made on implementing the beneficial ownership standard, but there are still challenges on technical issues. A toolkit entitled Building Effective Beneficial Ownership Frameworks published in 2021 was developed jointly by the Global Forum and IDB. The toolkit looks at relevant approaches to ensure that beneficial ownership information is available in line with international standards.
Next steps
It is generally considered that a “whole of government” approach to combating tax evasion and other IFFs, involving cooperation between tax administrations and other relevant law enforcement agencies, can strengthen enforcement efforts.
Priority will be given to using all the available channels for international co-operation to tackle tax evasion and other financial crimes. The Global Forum Secretariat will be involved in setting up a network of EOI trainers, through the “Train the Trainer” programme.
