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TRANSCRIPT
After the
…transparency, the new minimum standard?
Panama Papers
Presentation Title Here Date Here
Author Name Here
Agenda
The Political Economy
After the Panama Papers
Public Registers – The New Global Standard
Transparency in Practice
Why Jersey?
The Political Economy – It’s Complicated...
Source – The Economist
…It’s About to get Even More Complicated
AIFMD Diverted Profits Tax
FSB Shadow Banking
ICB/Ring-Fencing BEPS
MiFIDII / MIFIR
Bribery Act
UK PSC Register
CRD IV
Solvency II
EU Tax Package
Convention on Mutual Administrative Assistance in Tax Matters
FSA Liquidity
FATCA Basel III
IFRS 10
Resolution Regimes
Common Reporting Standard
MONEYVAL
G8 & G20 Agenda
UK Europe Global
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0
200
400
600
800
1000
1200
1400
1600
Debt (Dec 2015) Spending Fiscal deficit
(2015/16 estimate)
Total tax receipts Tax gap (2013/14) Tax gap -
evasion/criminality
Undeclared tax in
the CDs (HMRC
estimate)
1542
748
69.5
533
34 9.5 1
£ bn
Will offshore tax compliance plug the funding gap?
UK Government Finances
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0
200
400
600
800
1000
1200
1400
1600
1800
2000 1900
1463
139
900
202.5
0 0
R (
Bn
)
Will offshore tax compliance plug the funding GAP in South Africa?
Debt (Jan 2016)
Spending (2016/17 estimate)
Fiscal deficit (2016/17 estimate)
Total tax receipts (2014)
Tax gap - mid point (estimated)
Tax gap - evasion/criminality?
Undeclared tax in the CDs?
? ?
South African Government Finances
BEPS
Country Year(s) Estimated Yield Actual Yield
South Africa Temporary and permanent VDP
2010 to current Unknown R8.3bn
India black money bill
2015 Rs 2 Lakh crore (£10.5bn) Rs 3,770 crore (£393m)
UK CD facility Liechtenstein & Swiss facility
2013/14 & 2014/15 2009 up to 31/3/15
£400m £8bn
£17.7m £1.6bn
Russia 2015/2016 2007
Unknown Unknown
Unknown US$130m
Tax Amnesty’s/Disclosure Regimes – Do They Work?
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The Panama Pandemic
…Media Allegations Driving Pitchfork Politics
Nations Agree Tax Crackdown in Wake of Panama Leak and Anti-Corruption Summit on 12 May
Public Registries – a New Global Standard?
Following the G5 announcement, a further 40 countries have
signed up to the development of a global standard on beneficial
ownership exchange.
Jersey has committed to the standard, provided there is a level
playing field and that the international standard:
Is set up by the OECD
Is integrated with CRS reporting
Matches the CRS in satisfying the requirements of
congeniality and data safeguards
The Problem with Public Registers:
Self Reporting
Criminal Concealment
Impact on Private Companies
First Mover Disadvantage
Unintended Criminal Activity
Human Rights Impact
CRS AEOI
The Jersey Model – Regulation of Trust and Company Service Providers:
Only regulated TCSP’s can incorporate companies for non-Jersey
residents
Legislative requirements of TCSPs
Requirements for up-to-date and relevant data
JFSC routine examinations of service providers
The Jersey Model – International Recognition:
MONEYVAL Assessment
Rigorous assessment process over last 18 months
Jersey compliant/largely compliant in 48/49 areas
Highest score among states assessed in the
MONEYVAL 4th
elevation cycle – Jersey at the top of
the global table
“Jersey’s combination of a central
register of the UBO with a high level
of vetting/evaluation not found
elsewhere and regulation of TCSPs
of a standard found in few other
jurisdictions has been widely
recognised by international
organisations and individual
jurisdictions as placing Jersey in a
leading position in meeting
standard of beneficial ownership
transparency.”
Common Reporting Standard
Jersey committed as an early adopter of the CRS
BEPS Jersey has been fully supportive of the OECD’s BEPS programme
Transparency in Practice
US/UK Foreign Account Tax Compliance Act (FATCA)
What is reported
Impact on Jersey’s Private Wealth Sector
Jersey committed as an early adopter of the CRS
CRS - Jersey
When and who is it reported to
BEPS
Trustee:
Trustee does the reporting
on behalf of the trust
Discretionary Trust
Settlor / Grantor:
If settlor can benefit from
trust, report whole value
of trust plus
distributions.
If trust is not settlor
interested, settlor still
has a/c but value is nil.
Protector / Enforcer:
Reportable value will be trust value.
Beneficiary:
Report on distributions
received. No distributions
= no reporting
Assets
FATCA/IGAs – A Trust Example
Why Jersey?
Allan Wood, Business Development Director, Growth Markets – Jersey Finance
@jerseyfinance
www.jerseyfinance.je
Thank You