A report on developments by developing countries with the automatic exchange of information (AEOI) was prepared by the OECD’s Global Forum for the meeting of G20 finance ministers and central bank governors on 17 and 18 July 2023. The report with the title Update on the Implementation of the 2021 Strategy on Unleashing the Potential of Automatic Exchange of Information for Developing Countries focused on the progress made by developing countries and the need for technical support.
The Global Forum is responsible for ensuring that its member jurisdictions implement the international standards on the exchange of information on request and the automatic exchange of information. The Standard for Automatic Exchange of Financial Account Information in Tax Matters is an important tool for combating tax evasion and non-compliance.
Developing jurisdictions have increased their participation in AEOI, supported where needed by a capacity-building programme by the Global Forum. The report now prepared for the G20 finance ministers outlines the progress made by developing countries in AEOI with the support of the capacity-building programme.
AEOI has helped developing countries to mobilise their domestic resources and combat tax evasion and other illicit financial flows. Developing jurisdictions have identified more than EUR 36 billion in additional revenue in the form of tax, interest, and penalties between 2014 and 2022 as a result of the automatic exchange of information. They have received extensive information on the offshore financial accounts of taxpayers, amounting to information on more than 33 million financial accounts valued at nearly EUR 2.9 trillion. Developing countries have also sent information on more than 16 million financial accounts amounting to nearly EUR 0.5 trillion in value.
Most developing country members of the Global Forum are now implementing the Standard. A total of 48 developing countries have made a commitment to start AEOI by a defined date, representing more than half of the 92 developing members of the Global Forum. The developing jurisdictions that made a commitment to begin AEOI by 2022 have mostly kept to their commitments. The first results of the peer review process on AEOI indicate that the legal framework established by developing countries is generally satisfactory. The implementation of the strategy can be successful if there is strong political and technical commitment.
The Global Forum’s capacity-building programme needs additional resources to meet the growing demand for support from countries implementing AEOI and country by country reporting. The technical assistance can help to ensure that developing jurisdictions meet an adequate level of confidentiality and data safeguards, including information security management. Support can also be provided on the effective use of the financial account information received automatically.
