UHY GLOBAL JANUARY 2023 GLOBAL NEWS


GLOBAL NEWS


ASIA INITIATIVE TAKES OFF Members of the Asia Initiative have agreed a high-level work plan to enhance tax transparency across the region. Meeting in Bali, Indonesia, in September 2022, government ministers and tax commissioners from member countries, and development partners including the Asian Development Bank Group and the World Bank, established baseline actions for all members and complementary measures for members seeking enhanced cooperation on specific areas. The high-level work plan builds on the July 2022 Bali Declaration, which confirms members’ political commitment to capacity building and cooperation on tax transparency. The baseline actions aim to ensure effective implementation and use of tax transparency standards, and include participation in the Convention on Mutual Administrative Assistance in Tax Matters and establishing an exchange of information (EOI) function. “The sharing of experiences and views on the tax transparency agenda contributes to building an invaluable regional dynamic, which is very promising for the future of the Asia Initiative,” said Mr Suryo Utomo, chair of the Asia Initiative and director general of the Directorate General of Taxes of Indonesia. The Asia Initiative is supported by the OECD Global Forum on Transparency and Exchange of Information for Tax Purposes. Open to all Asian jurisdictions, it gives a regional voice to the promotion of international tax transparency, EOI, and tackling tax evasion and illicit financial flows. UK-SINGAPORE DIGITAL PACT A Digital Economy Agreement (DEA) between the UK and Singapore is the first digital-only trade agreement between individual Asian and European economies. Signed in June 2022, the DEA builds on the countries’ existing bilateral trade relationships and comprises agreements for programmes of cooperation in fintech, digital customs, cybersecurity, digital identities, electronic trade documents and electronic invoicing, to support open and inclusive digital markets, the free flow of data, consumer and business safeguards, digital trading systems, financial services and technology partnerships. The DEA also includes a commitment to strengthen the UK-Singapore Fintech Bridge established in 2016, boosting cooperation in digital financial services and supporting the expansion of UK and Singapore fintech firms. Cooperation on digital customs will include exploration of ‘single window’ interoperability and supply chain digitisation. Establishing digital-only trade rules and interoperability between digital economies, DEAs are a relatively new phenomenon. The Digital Economy Partnership Agreement (DEPA), signed electronically in June 2020, includes Chile, New Zealand and Singapore, and is open to all World Trade Organisation members – Canada and South Korea have applied for membership. The European Union has a DEA with Japan, and ASEAN economies are considering a regional DEA. Singapore also has DEAs in place with Australia and South Korea. Our DEA infographic explains more. IASB FIVE YEAR FOCUS The International Accounting Standards Board (IASB) has outlined its priorities to 2026, confirming a focus on digital financial reporting and the accessibility of existing standards. With increased use of digital financial information, the IASB has identified the need to consider its impact on accounting standards, alongside improving its usefulness, quality, accessibility and comparability. Activities will include a focus on the International Financial Reporting Standards (IFRS) Accounting Taxonomy, which is designed to improve communication between preparers and users of financial statements. Engaging with stakeholders including regulators and preparers is seen as essential to improve the IFRS Accounting Taxonomy and support its adoption. This will also involve working with the International Sustainability Standards Board (ISSB) to ensure consistency and compatibility with the IFRS Sustainability Disclosure Taxonomy, and to enable businesses to best engage with and use digital financial information and reporting. Collaboration with the ISSB is also expected as the IASB seeks to improve understanding and accessibility of accounting standards and to ensure their consistent application. This will include exploring new approaches to accessibility to both accounting standards and supporting materials, and may include the use of technology to highlight connections between standards issued by the two bodies. GIFT OF TRANSPARENCY New international standards for tax transparency have been issued by the Global Initiative for Fiscal Transparency (GIFT). Supported by organisations including the International Monetary Fund (IMF), the Organization for Economic Cooperation and Development (OECD) and the World Bank, the Transparency Principles for Tax Policy and Administration are designed to improve legal, regulatory and institutional frameworks in national tax systems. The 14 principles incorporate four levels of transparency – Basic, Intermediate, Advanced and Aspirational – and build on GIFT’s United Nations approved High-Level Principles on Fiscal Transparency by addressing the issue of revenue transparency directly. Juan Pablo Guerrero, GIFT’s network director of GIFT said: “The principles fill a major gap in the global architecture of fiscal transparency rules and aim to provide a robust but flexible reference point for policy makers and stakeholders to develop their own frameworks for taxation. They will help to promote informed public debates on tax reforms that will enable tax systems to raise needed revenues more equitably and efficiently.”


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