Mutual assistance between states in the field of taxation : the international, European Union and Maltese perspective

Abstract

In today's borderless world an increasing number of tax payers are engaging in cross border tax planning in order to mitigate their tax liability. This creates loss of revenue for tax authorities. In order to combat this, tax authorities of different States make use of legal frameworks enabling cooperation between States to ensure cross-border compliance with tax legislation. This system of cooperation between States is commonly known as mutual assistance. The origin and purpose of mutual assistance is dealt with in Chapter 1. In Chapter 2, I analyse the various legal instruments available at an international level; particularly the OECD Model Tax Convention and the OECD Convention on Mutual Administrative Assistance in Tax Matters. Chapter 3 contains an examination of the various initiatives made at the European Union level including the various interpretations that were given by the European Court of Justice, which has decided cases regarding mutual assistance in different ways and with different objectives. The way mutual assistance in tax matters has been transposed into Maltese law is dealt with in Chapter 4.