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Ulaanbaatar Declaration

01 Sep 2018

10 KEY PRIORITIES IN INTERNATIONAL TAXATION BY GLOBAL TAX ADVISERS PLATFORM (GTAP) 

“THE ULAANBAATAR DECLARATION”  

 

12 SEPTEMBER 2018

GTAP is an international platform that brings together national and international organizations of tax professionals around the world. The term “tax  professionals” includes  persons  engaged  at  professional  level with  tax consultancy, as lawyers or as accountants, and accredited as such pursuant to applicable national law, irrespective of membership of GTAP.

The principal purpose of GTAP is to promote the public interest by ensuring the fair and efficient operation of national and international tax systems including recognition of the rights and interests of taxpayers and the role of tax professionals. To this end, GTAP shall provide the forum for the regular meeting, dialogue and interaction of tax experts from all continents.

GTAP’s fundamental principle is that taxpayers’ and tax advisers’ interests are better pursued and served within a fair and efficient global tax framework.  Such  context  shall  favor  effective  provision  of tax  advice, continuous improvement of services, smooth cooperation among tax advisers, taxpayers and authorities, respect and professional excellence.

GTAP is conceived and developed to respond to the tax needs of the modern world. From the perspective of international taxation, the current era is marked by:

(i) International and supranational lawmaking and advisory bodies, such as the European institutions and the OECD;

(ii)  Transnational  taxpayers,  i.e.  groups   of  entities   structuring  their activities without frontiers; and

(iii) National tax authorities cooperating closely at international level.

Territorial boundaries of national tax jurisdictions  are fading in favor  of a global tax jurisdiction  defined by the new technologies.  Such technologies are also substituting for a number of tasks which until today were executed by tax professionals. Simultaneously, new opportunities and challenges are opening.

Remarkably, the ongoing transition has given rise to tax avoidance and evasion phenomena which have caused misunderstanding of the role of, and prejudice against, tax professionals. Hence, it is urgent to enhance trust in the tax profession and reaffirm its role as an enabler of tax compliance.

It is high time that the tax profession evolves to respond to the new context.  An  international   platform  can  embrace  the  joint  effort  of  tax professionals  of the world  to  track  the  developments,  exchange  views  and expertise, formulate holistic approaches and stimulate progressive solutions in international tax. It is the most appropriate step to strengthen our voice in a fast- changing arena.

Tax professionals must globalize, digitalize, and regain trust. The desired evolution is possible only through close cooperation at global level.

Optimization of tax consultancy within the current framework is the GTAP’s goal.

The 10 key priorities set for the pursuit of this goal are outlined below.

 

“THE ULAANBAATAR DECLARATION”

1. Strong cooperation among tax professionals

In a global tax arena, tax professionals cannot be limited by national boundaries. Effective tax consultancy requires that they adopt a global viewpoint, are aware of developments on a global scale, and can give answers for more than one  jurisdiction.  Taking  into   account  that  the  tax  world   is  increasingly globalizing, GTAP considers its utmost priority to assist tax professionals in fulfilling the demands created by these changes.

For this purpose, GTAP seeks to ensure availability and diffusion of information on and among different jurisdictions. Therefore, it will employ communication   platforms,    common   data    bases,   regular    meetings   and conferences  for  the  exchange  of  knowledge,   experience   and  ideas,  and publications.

 

2. Inclusiveness, Openness, Global reach

The  objective  of global  tax  consultancy can  only be  achieved in  the context of a global network, encompassing all tax jurisdictions.

Inclusiveness is a key principle: GTAP shall be open to each and every professional association of accredited tax advisers in every corner of the world, without distinction.

GTAP embraces difference and believes in the value created by interaction of singularities. Therefore, GTAP will seek to facilitate participation by keeping to the  minimum  any  costs,  applying  new   communication  technologies,  and organizing its meetings in all continents on a rotational basis.

 

3. Position of tax professionals in the tax scenario

Trust is an essential tool for the ongoing relationship between tax advisers, their  clients  and  tax  administrations.  The  current  global  tax  framework  is defective  and  its  loopholes  have  allowed  practices  to  develop  which  are inappropriate in the ethical and constructive global tax system to which we aspire.

Short term disclosure requirements, introduced as an emergency measure, threaten to drive taxpayers away from their professional advisers.

Nonetheless, as a rule, tax professionals’ services are necessary to ensure tax compliance. Tax professionals are the sole persons qualified to interact with the  tax  authorities  representing  taxpayers  to  the  latter’s  best  interests.  Tax professionals can render taxpayers and tax authorities’ communication successful and  effective,  advising  taxpayers  on  a  continuing  basis  on  their  rights  and obligations.

GTAP undertakes to increase the trust in tax professionals by, amongst other initiatives, establishing a common code of conduct for the provision of tax advice in a global tax world.

 

4. Impact on the Renovation of the International Tax Scenario

The  international   tax   scenario   is   changing.   Where   territorial   tax jurisdiction is fading to give space to a global tax world, territorial regimes lose relevance.

New laws are needed to regulate activities without confines and stateless income.

National and international legislative bodies are striving to identify appropriate criteria beyond national territories and physical presence for the taxation of modern economy.

Tax  professionals  have  much  to  contribute.  Their  experience  and expertise must be put at the disposal of legislators with a view to creating together a new, fair and efficient system of taxation, fit for the new conditions.

GTAP   shall   contribute   to   the   discussion,   participate   in   public consultations, take public positions and structure proposals to be used as basis for the new system.

In this respect, it is important that tax professionals express themselves with a single voice that will be heard clearly and loudly.

 

5. Proposal of a new tax system

In  the  framework  of  the  renovation  of  the  global  tax  regime,  tax professionals are in a position to offer more than contributions: they can take initiatives. Their position in the centre of the tax relations – interacting with both taxpayers and authorities – grants them unique expertise, allowing them to lead the change.

Therefore, GTAP shall encourage tax professionals of the world to take up the challenge of proposing a new system: simple, flexible, practical, fit for modern business, a system that can reclaim taxpayers’ confidence.

 

6. Taxpayers’ Rights

In the construction of the new system and the transition towards it, it is crucial to safeguard the rights of taxpayers. Adequate guarantees are a mainstay for the desired fair and efficient tax system as well as for any truly democratic community. Such guarantees are equally a prerequisite for tax professionals to carry out their assignments.

In this regard, GTAP prioritises taxpayers’ right to fair trial, encompassing the right to obtain advice and present one’s tax case, and be represented in tax disputes by tax professionals. Establishment of such rights in all jurisdictions around  the world will  be  sought  through  consultation  with lawmakers  and competent authorities, diffusion of information, opinion statements and legal actions. It is also necessary to ensure that such rights include the confidentiality of communications between tax professionals and clients. In this regard, Tax Professionals shall give due regard to the compliance obligations of taxpayers and should only act for taxpayers who are compliant or will become so following the actions proposed by the tax adviser.

 

7. Awareness and Foresight

The tax system is changing due to the evolution of business and economy. Such evolution is endless and the tax world must follow it closely so as to respond quickly to new needs and ensure effective taxation of new types of income and business models.

Tax professionals must be prepared for the change: they must be informed and proactive; they must acquire the tools and qualifications needed to serve new tax regimes.

GTAP  shall  seek  to  monitor the  changes and keep tax professionals abreast   of   them    through    internal    dedicated    specialized   teams   with interdisciplinary qualities. Such teams shall be devoted to research and conduct of studies  on  business  and  legal  developments  from  the  angle  of  the  tax professional.

 

8. Preparation for the Digital Era

Digital  technologies  are  changing  work  and  life  in  general.  The  tax profession   could  not  but  be  affected:   several  tasks  performed  by  tax professionals are now a matter of a few clicks. Concerns are accordingly being raised that the tax profession is vanishing.

However, GTAP sees a great opportunity where robots undertake tasks – mainly executive and supportive. It is tax professionals’ chance to take new initiatives and innovate.

To do so they need to qualify to exploit the new technologies’ potential, to extract and combine data, to program executive activities, and to give correct instructions.

GTAP will provide tax professionals with procedures and tools to master new  technologies,  maximize  their  value  and  be  competitive  in  an  evolving market.

 

9. Tax Advisers Without Borders (TAWB)

The globalizing  scenario impacts  on  relations  between  advanced  and emerging economies. Since the territory of activity is losing relevance, activities in the latter and their potential supervision by tax authorities become particularly important for the global economy. For taxation to work in a global economy, all jurisdictions must be on equal footing.

GTAP undertakes to ensure that tax professionals in emerging economies can respond to the needs of a global tax jurisdiction. To this end, GTAP shall establish  a  TAWB   (Tax  Advisers  Without  Borders)  function  to  promote exchange  programs,  conferences,  online  courses  and  interaction  platforms, digital  tools  and  respective  training.  Equally,  it  will  promote  diffusion  of information on the tax system of emerging economies for the benefit of tax professionals in advanced countries.

 

10. Tax culture and ongoing education

Apart from qualified tax professionals, a fair and efficient tax system requires  well  informed  taxpayers  and  authorities.  All  parties  of  the   tax relationship must have knowledge of the fundamental principles of taxation, their responsibilities and rights.

GTAP will enable the building of such culture. It will seek to ensure that all people all over the world have a real chance to understand taxes and be active participants in tax systems and policy development. To this effect, GTAP favors introduction of relevant lessons into schools and continuous availability of online courses.

 

Founders:

CFE, AOTCA, WAUTI

Observers:

STEP, IAFEI, AMA

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