Global corporations based in the UK will now have to report where they make their profits and pay their taxes to HMRC, the UK government has announced.
The new country-by-country reporting template was released this week by the OECD and the UK is the first of 44 countries to officially sign up.
“The UK has been at the forefront of tackling international tax avoidance,” said Financial Secretary to the Treasury David Gauke. “We believe that country-by-country reporting will improve transparency and help identify risks for tax avoidance – that’s why we’re formally committing to it.”
The template aims to help tax authorities to collect information on the international activities of multinationals, including their profits and taxes, making it easier to hone measures to reduce tax avoidance and to assess risk.
“In time improved transparency between business and tax authorities will also help developing countries in dealing with compliance, as they often lack the capacity to collect this information themselves,” said Gauke. “Reporting high level information using a standardised format across all jurisdictions will ensure consistency, give tax authorities the information they need and minimise the additional administration burden on business.”
The UK took a proactive role in conceptualising the template during the country’s presidency of the G8 last year. It has since called on the OECD to develop and strengthen the template to help strengthen international standards on Base Erosion and Profit Shifting (BEPS).
The reporting template will be presented to G20 Finance Ministers by the OECD this weekend.
Despite the data protection regulation being implemented in 2018, 69% of IT decision makers don’t have the backing of their board to achieve GDPR compliance, according to Calligo.
The majority of the region’s 28 member states report that the situation has worsened over the past year, reports business management consultant Verisk Maplecroft.
Regulators in the UK, the US and Hong Kong instituted proceedings against more than 1,700 individuals last year, or four times the number of cases brought against companies.
The US Commodity Futures Trading Commission approved LedgerX as the first regulated clearing house for derivatives contracts settling in digital currencies.