MercoPress. South Atlantic News Agency

Chile, Brazil and Mexico approve OECD fiscal transparency test

Chile displayed “a fiscal transparency system in great measure already active although some procedure aspects need improving”

Chile, Brazil and Mexico are among eight new countries which approved the first test of fiscal transparency from the Organization for Economic Cooperation and Development (OECD).

The other countries are Cyprus, Slovakia, Malta, Czech Republic and Saint Vincent and the Grenadines.

OECD said it had assessed seventy countries or jurisdictions and twelve failed to comply with the international standards on fiscal transparency. Costa Rica and Guatemala were among the countries that failed

The report says the test is a filter imposed by the Global Forum on Fiscal Transparency, under the OECD, an organization dedicated to promoting policies that improve economic and social wellbeing of people around the world.

The Global Forum on Transparency and Exchange of Information for Tax Purposes is governed by different rules to the OECD's other Global Forums.

In the report released on Thursday the Global Forum said that Chile displayed a fiscal transparency system in great measure already active although some procedure aspects need improving

In the case of Brazil the recommendation was the need to speed the process from the moment an agreement on fiscal information exchange is signed to the moment it becomes effective, which currently can last up to 24 months.

Supervisors said that Brazil has a framework of fiscal information exchange with 34 bilateral agreements, but there are some shortcomings in some of the oldest of those documents, given current restrictions.

Brazil will have to undergo a second review in the first half of this year to check the implementation of the recommendations.

Regarding Mexico the OECD report is positive saying the country has signed agreements with 60 jurisdictions, most of which are effective, and is in the process of negotiating others so the system is in line with international standards.

One of the few objections is that the information is not always accessible in the case of foreign consortia managed from Mexico, for which a specific review on the issue is scheduled for the second half of 2013.

In the report on Costa Rica it states that though the country has signed 13 new fiscal information exchange agreements and a Mutual Convention is in effect with Guatemala and Honduras, its domestic laws might hamper effective exchange of information.

In particular, ownership and accounting information related to companies, partnerships and trusts is not always available and the tax administration has insufficient powers to access information requested by foreign counterparts.

Costa Rica has six months to respond to the recommendations in order to reassess their situation and be able to submit the second phase of control.