Turkey and Belgium have increased their joint cooperation against double taxation. The pair have signed a new protocol to enable the increased flow of information in line with OECD standards aimed at negating the possibility of paying tax on the same income in two countries.
The protocol, signed yesterday during Turkish Finance Minister Mehmet Şimşek’s ongoing Belgium visit is basically an upgrade of the previous agreement between Ankara and Brussels. The existing agreement encompasses information exchange about only some fields of taxes, but the range is expanded with the new protocol.
The protocol sees laws in both countries teaming up to break down barriers of bank secrecy and tax competition, which will also help the pair combat tax evasion and in general trim away at lost tax revenues in both countries.
Tax evasion and bank secrecy has flown to the top of European government agendas following a massive leak of information and emails from so-called offshore tax-havens exposing the identities of thousands of account holders. The leak has not only brought new focus on the subject, but has also prompted several fraud cases in France.
In Turkey tax avoidance and evasion is arguably of even greater importance because of the countries big current account deficit. Turkish economic growth is once again surpassing that of the EU and it also arguably has less measures in place to combat tax evasion across borders than some EU countries. It looks like that could be set to change.