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Revenue Minister of New Zealand, Michael Woodhouse, has said that recently signing agreement on the report exchange between countries will be increase country's tax collection capability.
This agreement that provide country-by-country exchange of financial reports was recently signed by officials from New Zealand, Canada, China, Iceland, India, and Israel, totally 39 countries.
Woodhouse also said that some large multinationals often use some difficult financial scheme, what helps them to escape of paying tax, called base erosion and profit shifting. This new country-by-country reporting agreement is on the centre of financial activity, allow to participants exchange information of multinationals activity.
«Under that agreement, large multinationals will have to provide information relating to economic activity, including the global allocation of income and taxes paid," the Revenue Minister said. "Each revenue authority collecting this information to exchange with other countries. This also will show us a full picture of every multinational financial activity. According to this agreement it will be easier to control any tax wrongdoing».
The agreement can ensure us that large multinationals pay their fair share of tax.
