It examines the nature of banking, the complex structured financing transactions developed by banks and how they are then used by both banks and their clients. The report makes a number of recommendations for revenue bodies and identifies best practices for consideration by banks.
Recommendations for the Revenue Bodies are provided in the following areas:
- Improving staff capabilities and their commercial understanding of financial markets and banking;
- Providing earlier certainty;
- Improving risk assessment;
- Improving transparent tax compliance;
- Improving international co-operation.
A number of "good practice" recommendations for banks were indentified:
- the bank's internal tax department's decision not to proceed with a transaction should not be overridden without escalation of a decision to the CEO or board;
- bank's internal tax departments are encouraged to provide a greater degree of transparency in the governance of CSFTs (complex structured finance transactions) implemented both for clients and on the bank's own account;
- all banks should ensure that they have appropriately skilled and trained staff to review CSFTs for clients;
- in setting their business strategy, banks should consider the benefits of an enhanced relationship with revenue bodies including early certainty, reduced compliance costs, and reduced reputational risk; and
- as part of this relationship, banks should share their views with revenue bodies on tax risk assessment for products or services where there is potential for uncertainty around the tax treatment.
The report is available http://www.oecd.org/dataoecd/5/29/42797744.pdf