International automatic exchange of tax information – Second evaluation report upon request of the Panama Commission

The Belgian Court of Audit reports to the House of Representatives on the audit related to the international automatic exchange of tax information. It is an extension of the first audit carried out in 2019 following a recommendation of the special parliamentary commission dealing with the major tax evasion cases unearthed under the “Panama Papers” investigations. The purpose of the first audit was to determine whether the Belgian tax administration was able to efficiently process and use tax information provided by foreign tax authorities. Moreover, the Court of Audit wanted to know whether the audit results were sufficiently monitored and assessed by the Belgian tax administration. The first audit focused on the exchange of financial and non-financial information. The second audit is an update of the first one; it assesses the use of two new important international exchange mechanisms by the tax administration, namely the cross-border advance tax rulings (individual agreements between the tax administration and a taxpayer on transfer pricing or other tax matters so as to provide greater legal certainty) and the country-by-country reporting (a multinational company shall inform all countries where it is active of the global allocation of profits, the economic activities as well as taxes paid within the group).