The OECD’s Tax Transparency Forum has declined to grant the top rating of ‘compliant’ to the US’ tax transparency regime.
The principle reason for the jurisdiction’s failure to improve on its ‘largely compliant’ rating is its unsatisfactory law regarding disclosure of company beneficial ownership.
The OECD’s peer review report, issued this week, criticised the US’ legal system for ‘gaps in respect of legal requirements to obtain and maintain beneficial ownership information as well as in respect of their implementation in practice’. These gaps remain in place even though ‘recent positive steps’ have addressed the recommendations made by the OECD in its first round review of the jurisdiction.
‘The availability of beneficial ownership information [still] poses a challenge’, says the peer group report.
Another of the peer group’s reservations centred on the US’ failure to ratify any of the international exchange of information agreements it has signed with other countries since 2010 – including the 2010 protocol to the OECD’s Multilateral Convention.
‘This negatively impacts a significant number of US partners, and the US is recommended to ratify these signed agreements expeditiously so that all its exchange of information (EOI) relationships are in force’, says the OECD. In the meantime, it should ‘expeditiously pursue any alternative means to ensure effective EOI arrangements that meet the standard are in force with affected jurisdictions’.
Guernsey and San Marino both received ‘compliant’ ratings in the assessments issued this week, while Indonesia, Japan and the Philippines were rated ‘largely compliant’ and Kazakhstan was rated ‘partially compliant’.