Automatic exchange of information involves the systematic and periodic transmission of “bulk” taxpayer information by the source country to the residence country concerning various categories of income (e.g. dividends, interest, etc.). It can provide timely information on non-compliance where tax has been evaded. An AEOI regime was designed by the OECD and the Global Forum at the instruction of the G20.
These organizations have collectively made efforts for the design of the commonly accepted Automatic Exchange of Information (AEOI) for efficient transmission of tax information exchange among countries.
Under the aegis of the Global Forum, in June 2015, sixty-one countries including India have signed a Multilateral Competent Authority Agreement regarding the implementation of the new standard for AEOI. Countries also agreed to adopt a common reporting standard (CRS, designed by the Global Forum), needed to facilitate information exchange.
As a result of this agreement, a global automatic information exchange regime is going to be established by 2018. As per the peer group review of the Global Forum, as many as 61 countries would see their ‘first exchange’ taking place in 2017, followed by another 35 in the year 2018.
