The European Council has approved a standard provision on good tax governance to be included in EU agreements with third countries.
The aim of the provision is to prevent cross-border tax fraud and evasion with third countries.
It looks to tackle this on as broad a geographical basis as possible, while taking into consideration the particular situation of each third country.
The Council’s report noted that an updated provision would include the global standards of transparency and exchange of information, fair taxation and anti-BEPS standards. It added that good governance in the tax area is not only beneficial in preventing cross-border tax fraud and evasion, but could ‘strengthen the fight against money laundering, corruption, and the finance of terrorism’.
This provision reflects developments in international tax standards since the previous provision was agreed in 2008, which includes the OECD standards aimed at preventing corporate tax base erosion and profit sharing.