Counteracting the use of low tax jurisdictions in international tax avoidance and tax evasion: an argument for the development of a global information repository

The international climate regarding tax avoidance and evasion via low tax jurisdictions is one of intense scrutiny. The prevailing view is that secrecy provisions in low tax jurisdictions are used to facilitate illicit fund transfers from other jurisdictions into monetary flows that are difficult to trace. Moreover, they obfuscate the identity of individuals who are the beneficiaries of such strategies. There are a number of initiatives in place to deal with this problem in an attempt to achieve international financial and tax equity.Part of the solution to this issue is to improve exchange of information between jurisdictions. This can be achieved through the creation of a unique instantaneous exchange of information mechanism. This thesis proposes this as a contribution to existing initiatives but with the added benefit of improved technology.This thesis addresses a gap in knowledge created in part by the dominant OECD approach, which is a 'request of information process'. This process incorporates legal safeguards designed to protect individual taxpayer confidentiality. The other component contributing to the gap is automatic exchange of information. This initiative seeks to accelerate information exchange but is limited by the depth of information able to be exchanged. Unsurprisingly, the latter is gathering international momentum due to the volume of data and the speed with which it can be transferred. A gap occurs at the point of overlap between these two approaches. This is because there is a trade-off between the safeguards inherent in the one and the volume of data transferred in the other. The safeguards protect taxpayer rights but can be hampered by local jurisdictional inefficiencies. This, in turn, leads to a lack of timeliness and effectiveness in detection and enforcement. The automation leads to large volumes of data being transferred but cannot legitimately contain data with the depth of a specific request.This gap is challenged by the solution proposed. That is, the uploading of data to and downloading from an international tax repository. This includes both highly specific case information from audits and other compliance action; and bulk data of the kind currently transferred under automatic exchange of information