MCAA
The Multilateral Competent Authority Agreement on Automatic Exchange of Financial Account Information (MCAA) is a framework for the automatic exchange of information (AEoI) abetween tax authorities of different countries. The MCAA was developed by the Organization for Economic Co-operation and Development (OECD) in 2014 as part of the Common Reporting Standard (CRS) initiative.
The CRS is a global standard for the automatic exchange of financial account information, which requires financial institutions to report information on foreign account holders to their local tax authorities, who then share the information with other tax authorities through the MCAA.
The MCAA provides a standardized legal and technical framework for the automatic exchange of financial account information between participating countries. It sets out the rules for data confidentiality, data protection, and the procedures for exchanging information.
As of 2021, more than 100 countries have signed the MCAA, and the automatic exchange of financial account information has become a global standard for tax transparency and cooperation.
The MCAA is an important tool for combating tax evasion and promoting tax compliance, as it allows tax authorities to identify and investigate cases of non-compliance more efficiently. It also promotes fairness in the tax system by ensuring that all taxpayers are treated equally and pay their fair share of taxes.
Indonesia combat tax evasion
Indonesia has signed the Multilateral Competent Authority Agreement (MCAA) for the automatic exchange of financial account information under the Common Reporting Standard (CRS) in October 2014 and has been participating in the AEOI under CRS since 2018.
Under the MCAA, Indonesia’s tax authorities can automatically exchange financial account information with other participating jurisdictions on an annual basis. The information exchanged includes the name, address, taxpayer identification number, date of birth, account number, account balance, and income earned on financial accounts held by non-resident individuals and entities in Indonesia.
The MCAA helps Indonesia to combat tax evasion and improve its tax compliance by allowing the tax authorities to identify taxpayers who may be hiding assets and income in foreign accounts. It also supports the global fight against tax evasion by promoting transparency and information exchange between tax authorities.
Also read : Common Reporting Standard
Aslo read : A Tax Information Exchange Agreement (TIEA)