AUSTRALIA URGES OECD TO BE LENIENT

COMMONWEALTH OF AUSTRALIA

Department of Foreign Affairs and Trade Office of Foreign Affairs Canberra, Australia

 

March 1, 2002

ON PACIFIC ISLAND NATIONS

The Australian government is aware that a number of Commonwealth small states, many of them Pacific Island nations, have expressed concerns about the implementation of the OECD's [Organization for Economic Cooperation and Development] harmful tax initiative. The government supports the aims of the OECD initiative, which seeks to promote transparency and exchange of information on tax matters between countries.

International cooperation against systematic tax evasion is consistent with the government's own efforts to prevent tax evasion and the erosion of Australia's revenue base. But the Australian government has consistently emphasized that the concerns of small states and the special challenges that they face (including fragile economies, resource constraints and infrastructure limitations) must be addressed if the initiative is to succeed.

The Australian government is therefore strongly committed to a cooperative consultative approach by the OECD that will ensure that small states' views and concerns are a central part of the harmful tax work. Australia has previously raised the Pacific's concerns directly with the OECD and has provided considerable extra technical assistance to help affected Pacific states engage with the requirements of the initiative.

At the Pacific Islands Forum in August, Australian technical assistance was offered to Pacific island nations to help them determine practical requirements and develop appropriate capacities to respond to the OECD initiative. This workshop successfully took place in Canberra on 11-14 December 2001.

Australia will continue to seek a cooperative outcome where small states are encouraged to work collaboratively with the OECD in developing the necessary technical capacity and establishing appropriate regulatory frameworks that reflect the needs and concerns of all the parties involved.

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