New international tax regulations entering into effect on Monday requiring the disclosure of cross-border aggressive tax planning arrangements to tax authorities could help eliminate many international tax loopholes, a finance ministry official said.
The OECD estimates that
multinational companies have paid 100-240 billion dollars less tax per year globally with the help of tax planning strategies,
Norbert Izer, state secretary for tax affairs, told MTI.
These strategies are used to exploit the differences between international conventions and the tax rules of individual states mainly be setting up shell companies without any real operations or performing unnecessary financial operations within the corporate group to reduce tax liability, Izer said.
International cooperation is the only effective way to combat cross-border tax evasion, he said. In addition to the risk analysis carried out by Hungary’s tax and customs authority NAV, international information sharing is now also vital when it comes to catching tax dodgers, the state secretary said.