OECD System to Reduce Compliance Cost and Facilitate Cross-Border Investment

The amount of cross border portfolio investment exceeds US$35 trillion. To encourage growth and cross-border investment more than 3000 tax treaties around the world based on the Organisation for Economic Co-operation and Development Model reduce source taxation on a reciprocal basis.

 

In practice, however, claiming withholding tax relief under treaties and domestic law is often cumbersome, time and resource intensive for the bulk of foreign portfolio investors and thus often does not happen.

 

After several years of work with governments and businesses around the world and in close co-operation with the EU, the OECD has developed and approved a standardised system of effective treaty and domestic relief including a complete implementation package for countries to move forward.

 

The Treaty Relief and Compliance Enhancement (TRACE) is a major step in streamlining processes, reducing costs, and giving investors their rights while improving tax compliance, says the OECD.

Read more on

Suggested Articles

Some of you might have already been aware of the news that Questex—with the aim to focus on event business—will shut down permanently all media brands in Asia…

Some advice for transitioning into an advisory role

Global risks are intensifying but the collective will to tackle them appears to be lacking. Check out this report for areas of concern