Practical on-line seminar on the topic: “Common Reporting Standard (CRS). Discussion of tentative Action Plan of the State Tax Service for implementation of the Common Reporting Standard” for representatives of the State Tax Service of Ukraine”

Project “Effective Public Financial Management III”, implemented by the German Society for International Cooperation (GIZ) on behalf of the Government of Germany at the request of the State Tax Service, held practical online seminar on the topic: “Common Reporting Standard (CRS). Discussion of tentative Action Plan of the State Tax Service for implementation of the Common Reporting Standard” during 25 – 27.09.2021.

Seminar was conducted by experienced German experts from the Federal Central Tax Office (Bonn), Ms. Olga Asseburg-Witfeldt and Mr. Arno Neumann. They shared the experience of implementing the Common Reporting Standard (CRS) with Ukrainian colleagues in a framework of automatic exchange of tax information between countries (AEOI), internal organization of the automatic exchange of information in Germany, presented legal basis for the CRS implementation, considered IT security and data protection in the exchange of tax information.

In addition, German experts discussed with representatives of the State Tax Service of Ukraine some aspects of national legislation of Ukraine aimed at implementing the CRS’s provisions and discussed in detail the indicative Action Plan of the State Tax Service of Ukraine to implement the Common Reporting Standard (CRS).

All this allowed representatives of the State Tax Service and the Ministry of Finance of Ukraine to gain additional important experience in implementing common international standard for the automatic exchange of information regarding financial accounts for tax purposes.

Additional Information

On 03.12.2019, the Verkhovna Rada of Ukraine adopted two laws implementing requirements for Ukrainian financial institutions to submit reports for the purpose of automatic exchange of information according to FATCA and CRS standards (№ 322-IX as of 03.12.2019 and № 323-IX as of 03.122019).

Goal of the Common Reporting Standard (CRS) is to expose real business owners, increase cash flow transparency, and, as a result, minimize opportunities for tax evasion and prevent aggressive tax policies.

On 18.08.2021, the Government of Ukraine approved a draft letter to the Global Forum of Organization for Economic Cooperation and Development (OECD) regarding intention of the Government of Ukraine to introduce common international standard for automatic exchange of information regarding financial accounts for tax purposes (hereinafter – the CRS Standard).

Introduction of the CRS Standard will create conditions for Ukraine’s accession to effective international system for exchange of tax information by acceding to the Multilateral Agreement between the competent authorities on the automatic exchange of information regarding financial accounts.

This will allow to:

- provide more transparent tax environment and help counteract the use of aggressive tax planning schemes;

- increase taxpayers’ level of compliance with tax legislation;

- prevent tax evasion.

According to the OECD, the number of 100 tax administrations exchanged information regarding 84 million financial accounts with assets worth about 10 trillion euros in 2019. Every year, the international network of automatic exchange expands, namely 105 countries exchanged in 2020 and 4 more countries will make their first exchange in 2021.

Ukraine plans to make the first exchanges of information in September 2023 for the reporting year 2022.