New and successful experiences ‘structural and operative aspects’ A Jamaican perspective Workshop on Exchange of information Plantation, Florida, USA July 24-26, 2012 Presented by: Dave Jeffery Tax Administration Jamaica

What is is Exchange Exchange of of Information ?... Information ?...

…the request for and provision of information using guidelines outlined within the ambit of Treaty Agreements (Double Taxation, Multilateral or Tax Information and Exchange Agreement)

Why is Exchange of Information Important ? To mitigate against the effects of Tax Avoidance To identify Tax Evasion To prevent Double Taxation To build and establish relationships with treaty partners for tax purposes

TAJ Organizational Structure reflecting the EOI unit The Large Taxpayer Office was established in 2009 Need to exchange information based on the complexes of issues due to large multi national company been audited. EOI unit was developed to assist the LTO. Amendments to the organization Structure of TAJ  EOI unit playing supporting roll to the LTO, to other divisions of TAJ, investigation and debt management.

TAJ Organizational Structure reflecting the EOI unit

Large Taxpayer Office Organizational Structure

EOI office and its linkage with TAJ

The Jamaican experience prior to EOI unit Jamaica’s involvement with the exchange of information began since These come in the form of Double Taxation Agreements (DTAs) and Tax Information Exchange Agreement (TIEAs). Currently there are 11 Bilateral (DTAs)  two with TIEAs and  one Multilateral DTA with CARICOM.

Exchange of Information InformationAgreements currently in force Country/Group Type of Agreement United Kingdom DTA GermanyDTA CanadaDTA United States DTA & TIEA IsraelDTA SwedenDTA DenmarkDTA NorwayDTA CARICOMMLAT FranceDTA ChinaDTA Spain

The Jamaican experience prior to EOI unit request for information came mainly from USA, UK and Canada over the years Mostly directed to various division of TAJ, MOF and in some cases MOFA. This saw inefficiencies and delays in responding to treaty partners.

The Jamaican experience prior to March workshop Information received in the form of Spontaneous and Automatic EOI were never always deal with and in some cases were not acknowledge. Although some request for information received was sent to a particular unit there were no standard time in acknowledging and giving a feed back to sending country

The Jamaican experience prior to March workshop Most importantly, there was no Mechanism in place to sensitizes, advice and encourage staff to make request for information with the 11 treaty partners that Jamaica currently have agreement with. This could have significantly improved our ability to audit and collect taxes.

The Jamaican experience post march workshop The advent of the EOI office saw an organized, effective and efficient process flow of information between TAJ and Treaty partners. The office was officially launched March 16, with the assistances of representatives of several international organizations and tax administrations.

The Jamaican experience post to EOI unit OECD CIAT WORLD BANK IRS ITALIAN REVENUE SERVICES

The Jamaican experience post to EOI unit Having received training and guidance as to international best practices and standards in setting up and operating an EOI office, we were able to effectively respond to our first request for information within days of the work shop.

Benefits of the March workshop Great improvement in the knowledge base and capacity building of TAJ staff – Base on Island wide training and sensitisation. TAJ now see several areas where we can now identify potential tax losses and enhance tax collections. The tourist industry is one such example.

Benefits of the March workshop An increase in Administrative co- operation between TAJ and other Treaty Partners. E.g.. TAJ and IRS TAJ awareness to abusive tax schemes and emerging trends in tax planning. E.g. Transfer price and the roll of EOI.

Achievements to date Production of a 36 page manual which gives details of the process flow, functions and operations for the effective management of an EOI office. Conduct an Island wide awareness and sensitization programme which covers some 16 presentations to over 360 staff members across TAJ.

Achievements to date Dispatching official communiqué to some of our treaty partners, International tax organizations such as OECD, CIAT, CATA, COTA, Global Forum, and local government entities for example, Ministry of Finance and Planning, Ministry of Foreign Affairs etc. to inform and advise of the establishment of the EOI office.

Achievements to date Establishing and building of relationship with some of our treaty partners. Develop and establish memorandum of understanding and linkages with divisions and units of TAJ in an effort to leverage on key areas such as Debt Management, Audit and Legal service.

Achievements to date Received and acknowledge 19 specific requests for information Make request for 5 cases of specific information Received spontaneous information from one Caribbean counter part which we are in the process of checking

Challenges to date The need for an information Technology infrastructure which could accommodate an EOI tracking system with work flow and automatic notification functionalities. An inability to access certain information locally from from 3 rd parties because of various legislations that govern there operations.

Challenges to date Difficulty in getting the names and addresses of the competent authority of all our Treaty Partners. (Even in CARICOM) A need to expand our psychical office space to accommodate the full staff compliment.