As a part of the measures being taken by the Ministry of Finance to increase enforcement against tax evaders operating outside of Israel and Israel’s commitment to keep generally accepted international standards, Israel joined the Convention on Mutual Administrative Assistance in Tax Matters on 24th November, 2015.
The Convention on Mutual Administrative Assistance in Tax Matters was developed by the OECD and the Council of Europe, as a multilateral instrument of cooperation in tax matters and to confront tax evasion and tax avoidance. Since 2010 the convention was signed by 90 countries (including all of OECD members except for Israel) in order to create an international network of information exchange in tax matters.
Following the provisions of the conventions, tax authorities of the participating countries will assist one another in:
- Supplying information to a state for the enforcement of its tax laws. The information will be transferred upon request concerning a certain taxpayer or deal, and automatically-periodically or spontaneously according to categories that will be decided in advance. The convention includes provisions for secrecy of the information.
- Performing simultaneous tax examinations in two countries or more will be possible upon mutual agreement of the countries involved.
The State Revenue Administration in the Ministry of Finance adds that Israel will enforce the convention on direct taxes only (not including social security). Furthermore, Israel will not enforce the convention’s provisions on assistance in tax examinations abroad, tax collection and Service of documents.