Takeaways from the 2024 IFA APAC International Tax Conference

2024 IFA APAC International Tax Conference

The 7th IFA Hong Kong 2024 Asia Pacific Regional Tax Conference took place on April 22-24. This event brought together the speakers from the OECD and the UN along with leading minds and professionals in the field of international taxation. Three days of informative presentations and robust panel discussion highlighting what the Future of Tax in the Asia Pacific Regions could look like.

Key Takeaways from the conference which include:  

• Trend towards tax transparency in Asia Pacific

• Implementation of CARF in Asia Pacific

• Trend toward implementation of Tax Technology in Asia Pacific

Trend towards tax transparency in Asia Pacific

With over 10 years of  Automatic Exchange of Information (AEoI) under the Foreign Account Tax Compliance Act (FATCA) and Common Reporting Standard(CRS), the tax transparency agenda has made continuous progress in Asia Pacific as more and more Asian jurisdictions joined the Global Forum over the past decade.

 11 APAC jurisdictions have signed an Intergovernmental Agreement (IGA) with the U.S , and are committed to exchanging information under FATCA regulations. These include:

• Australia
• Hong Kong
• Japan
• Malaysia
• New Zealand
• Singapore
• Taiwan
• India
• South Korea
• Vietnam
• Cambodia

14 APAC jurisdictions have committed to exchanging accountholder information under CRS and adopted it into local law. These jurisdictions have multilateral or bilateral agreements in place that specify the required information to be exchanged.  These include:

• Australia
• Hong Kong
• China
• Indonesia
• Japan
• Malaysia
• New Zealand
• Singapore
• Taiwan
• India
• Korea
• Thailand

This clearly highlights a trend towards tax transparency in Asia Pacific, with a number of jurisdictions placing priority on tax transparency and tax co-operation as a means to tackle tax evasion. Although implementing the tax transparency standards can be resource demanding for jurisdictions and their tax administrations due to the need to put in place the legal framework, as well as the organisational and practical infrastructure. Asian jurisdictions have made good progress towards an effective implementation of these standards.

Implementation of CARF in Asia Pacific

On the second day of the Conference, the implementation of Crypto-Asset Reporting Framework (CARF) in Asia Pacific was discussed. CARF is a new regulatory framework developed by the Organisation for Economic Co-operation and Development (OECD), and has recently had 48 tax jurisdictions commit to implementing  by 2027.

This list includes the following jurisdictions for the Asia Pacific region:

• Australia
• Japan
• Korea
• Singapore

CARF is the new standard for Crypto Reporting for 2026. These jurisdictions will need to work towards transposing CARF into their domestic law and activating exchange agreements in time for exchanges to commence by 2027, subject to national legislative procedures as applicable.

Alongside publication of the CARF the OECD also published CRS amendments. Signatory jurisdictions will need to implement amendments to the CRS, agreed to by the OECD, in line with the same timeline of by 2027.

Trend toward Tax Technology in Asia Pacific

In Asia Pacific tax authorities and private companies alike are dealing with the same challenges in updating old technology and automating manual processes. In recent years we have seen many countries and tax authorities in Asia Pacific quietly evaluate and invest in AI and machine learning solutions to achieve their tax administration goals. There has been a seismic shift in reshaping how tax authorities and businesses approach tax compliance and the adoption of AI and machine learning technologies.

Notable examples of tax authorities adopting tax technology include:

• In India, the Income Tax Department is using AI tools to assess income tax returns whose ratio of donations to charitable trusts and political parties compared to income is skewed. The department is reviewing prior year data which had previously not been heavily scrutinized.
  • Income Tax Department Sends Notices To Tax Evaders Using Artificial Intelligence (india.com)
• Additionally, the Australian Taxation Office (ATO) has curated machine learning algorithms to consume large amounts of data to provide tax assessments timelier. Their machines are trained to use historical data to make improvements resulting in processes which used to take months now taking only days.
  • How we use data and analytics | Australian Taxation Office (ato.gov.au)

The realization of the power of digitization and modernizing tax process forms part of the journey created by FATCA and CRS; a journey towards greater transparency, efficiency, and accountability. Data-driven insights guide tax authorities and businesses towards a future where taxation fuels growth, not burdens it.

We would value to discuss with you more about your compliance process and how our award-winning FATCA and CRS Validation platform can help you manage the latest regulatory updates. 

For more information get in touch or request a demo to see it in action.