G20 Leaders Hangzhou Summit
Session 2: For a fairer and more robust international tax system
Remarks by Angel Gurría,
Hangzhou, China, Monday 5 September 2016
(As prepared for delivery)
President Xi, Heads of State and Government, dear colleagues:
Restoring trust in governments, ensuring that globalisation benefits all segments of society, is a must. As highlighted by many of you, fighting tax evasion and tax avoidance is one way to address the growing concerns of citizens.
The G20 has a success story to share: we have taken up the fight against tax havens and we are now moving towards a fairer tax environment.
Thanks to our work on transparency, the rich will no longer be able to hide their assets and income in tax havens. Bank secrecy is gone and as soon as next year, 100 countries will start exchanging bank information automatically on their non-residents. Even the most reluctant countries, like Panama, have now decided to join. As a result, €55 billion of taxes have already been collected from taxpayers who have disclosed their foreign secret accounts. Beyond the revenue collected, it is the fairness of our tax systems which is at stake.
Tax havens have also been massively used by multinational companies through aggressive tax planning. Billions of euros of profits have been stashed in zero-tax jurisdictions costing almost a quarter trillion euros of lost corporate income tax yearly. This is why you supported the BEPS project, launched in 2013 and delivered last year in Antalya. Thanks to the BEPS measures, double non-taxation (as was the case of Apple, recently highlighted) will no longer be possible. These are not just words: the laws in Ireland that allowed the Apple arrangement have already been dismantled; thousands of tax treaties will soon be modified by a single multilateral convention to stop abuses.
It is key, however, that the BEPS package be implemented swiftly and that we only have one standard going forward. I am glad the EU Commission intends to implement BEPS through legislative action focused on the future, while state aid cases deal with the past, without creating a precedent on where to allocate the rights to tax.
I would like to conclude by thanking the Chinese presidency for having put tax policy on the G20 agenda: tax policy has no doubts a contribution to bring to our efforts to promote inclusive growth and to increase tax certainty. With the IMF we will be able to report to you with proposals in 2017.
Thanks to you, tax cooperation is now the rule and the best way to regulate globalisation.
Thank you for your trust and leadership!