Additionally, a further one in five senior fraud managers surveyed said they expect the increase to be up to double last year’s levels. 22 percent of the respondents felt tax evasion would decrease this year.
The response is not as expected even though new reporting regulations, the Common Reporting Standard, are being introduced this year to address tax evasion.
Common Reporting Standard (CRS) calls on jurisdictions to obtain information from their financial institutions and automatically exchange that information with other jurisdictions on an annual basis. CRS incorporates progress made within the European Union, as well as global anti-money laundering standards, with the intergovernmental implementation of the Foreign Account Tax Compliance Act (FATCA) having acted as a catalyst for the move towards automatic exchange of information in a multilateral context.
India and Korea will be the first countries to commence reporting in 2017, with Singapore, Australia, New Zealand, China, Japan, Indonesia, Malaysia, Brunei, Macao and Hong Kong due to start in September 2018.
Currently, banks are a long way from this goal, with 68 percent of respondents saying that they do not have the resources or solutions to identify and report the accounts of private persons and companies to other jurisdictions.
Tax evasion is a money laundering predicate offence listed in the Corruption, Drug Trafficking and other Serious Crimes (CDSA) Act.
The global super-rich is stashing trillions of dollars offshore with the help of some of the world’s biggest banks, putting billions of dollars out of the taxman’s reach and masking wealth inequality’s actual heights.