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France, Panama to create bilateral body to curb tax evasion

French Minister Gérald Darmanin announces formation of bilateral body to tackle tax fraud
French Minister Gérald Darmanin announces formation of bilateral body to tackle tax fraud

France and Panama have signed an agreement to create a group in order to curb tax fraud. The bilateral agreement comes years after Panama was blacklisted due to Panama Papers scandal.

French Minister of Public Accounts Gérald Darmanin promulgated on Twitter that France and Panama have decided to create a body to deter tax fraud. “With Panama’s Minister of Economy and Finance, Hector Alexander, we signed a memorandum to bring our tax cooperation to the level of international standards,” Darmanin said on Twitter.

As part of the agreement, the bilateral body will meet twice a year to discuss ways to ameliorate the exchange of fiscal information. Despite France and Panama effectuating double taxation agreements, the move was taken as Paris found the information exchange unsatisfactory.

“For now, we will work, and when we have the relationship of trust between the two countries, when the automatic exchanges of information will be perfect, then we will actually study the removal of Panama from the French list of tax havens,” Darmanin avowed.

France withdrew Panama from the list of countries that are tax havens in 2012, but was hastily put back on the list in 2016 after the Panama Papers scandal.

Following the scandal, Panama has come up with several financial reforms that are in line with the standards of International World Forum or Organization for Economic Co-operation and Development (OECD). European Union acknowledged Panama’s effort and removed it from their blacklist. However, the International Financial Action Group (FATF) put Panama back on its ‘grey area’ of countries that do not take enough measures to tackle money laundering and terrorist financing.

The French government, on the other hand, is currently investigating at least 500 cases of tax evasion by French nationals due to the Panama Papers revelations.

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