Financial Crime World

EU Parliament Endorses Agreement with San Marino to Combat Tax Evasion

Brussels, Belgium - European Parliament Approves Deal to Enhance Tax Transparency with San Marino

The European Parliament endorsed an agreement on Thursday, December 22, 2016, with the microstate of San Marino, aimed at enhancing transparency and combating tax evasion and financial crime. The deal will make it more difficult for EU citizens to hide funds from tax authorities in San Marinoan banks.

Key Provisions of the EU-San Marino Agreement

  • Automatic Exchange of Financial Account Information: The accord mandates the automatic exchange of financial account information between EU member states and San Marino, to be initiated from 2017. This exchange will include income, such as interest and dividends, account balances, and proceeds from the sale of financial assets.
  • Stricter Measures by San Marino: San Marino agrees to adopt stricter measures, equivalent to those in the EU since March 2014, ensuring compliance with the global standard on the automatic exchange of financial account information promoted by the Organisation for Economic Co-operation and Development (OECD).

Benefits of the New Agreement

  • Effective Tax Collection: This deal enables tax administrations in EU countries and San Marino to identify and collect taxes from individuals more effectively, assess the likelihood of tax evasion, and avoid unnecessary further investigations.
  • Following in the Footsteps of Switzerland and Liechtenstein: This agreement follows similar pacts reached with Switzerland and Liechtenstein.

Entering into Force

The agreement will enter into force on January 1, 2017. The European Parliament approved the deal with a considerable majority, with 607 votes in favor, 22 against, and 18 abstentions.

European Commissioner for Taxation’s Statement

European Commissioner for Taxation, Pascal Saint-Amans, expressed his satisfaction: “I warmly welcome the European Parliament’s endorsement of the EU-San Marino agreement on the automatic exchange of tax information. This is an essential step in our fight against tax evasion and financial crime.”