Panama signing of OECD Convention a step forward

PANAMA’S  recent signing of the Convention on Mutual Administrative Assistance in Tax Matters is an important step in its  efforts of Panama to improve fiscal transparency, as well as the effective exchange of information.

The statement comes from Pascal Saint-Amans director of the Organization for Economic Cooperation and Development (OECD).

He told La Prensa: “We are convinced that Panama is moving in the right direction,” said the director, who recently answered questions about the relationship between Panama and the organization.

How did the OECD evaluate the decision by Panama to be part of the convention?

Signing the agreement was a very important step. To meet the standard, a country should have an extensive network of bilateral treaties, So far, this has not been the case he said.

The signing of the agreement means that Panama will now have more than 100 partners. This will be useful when the Global Forum reviews the implementation of the standard by Panama.

Panama was committed to the exchange of information from the beginning of the year 2000. However, yhe country  had not been accepted by the OECD as a jurisdiction which complied with international standards for the exchange of tax information, since its  legislation had many shortcomings.

It had failures in the lack of availability of information on the final beneficiary of a company or the inadequate access to tax information.

The Global Forum will probably grant a poor rating to Panama in the plenary session next week in Tbilisi, Georgia.

However, the signing of the convention, as well as changes of the last week in the national legislation, are an element of change.

France argues that Panama does not comply with the demands of fiscal information and will include the country in the list of tax havens in 2017.

“The signing of the agreement does not address this issue, but I know that Panama is also working hard to implement the tax administration capabilities to be able to respond to requests.

“I believe that the practices are changing, and this is precisely what is going to change the opinion of the partners of Panama.

“Panama, in fact, has vowed to exchange information automatically from the year 2018.

This commitment must now be implemented and we are working with the Panamanian authorities to make this happen. The evaluation will come later said Saint-Amans.