Does Global Financial Transparency Improve Tax Compliance in Developing Countries?

This webinar draws on new research from the Southern Africa – Towards Inclusive Economic Development (SA–TIED) programme, examining the impact of global financial transparency initiatives on tax compliance in developing countries, with a focus on South Africa. Using an unprecedented combination of foreign bank account reports, taxpayer records, and audit data, the study explores how the automatic exchange of financial account information has influenced taxpayer behaviour and strengthened tax enforcement.

The findings reveal that the introduction of automatic information exchange led to a sharp increase in the reporting of foreign financial income by South African taxpayers. The research provides important insights into the effectiveness of international cooperation in combating offshore tax evasion and enhancing domestic revenue mobilisation in developing economies.

Speakers Niels Johannesen and Nadine Riedel will unpack:

• How automatic exchange of financial information is transforming tax enforcement.
• The extent to which global financial transparency improves taxpayer compliance.
• Why substantial offshore income remains unreported despite enhanced information sharing.
• The role of audits and detection risk in shaping taxpayer behaviour.

The presentation is based on the SA–TIED Working Paper “Does Global Financial Transparency Improve Tax Compliance in Developing Countries?” by Niels Johannesen, Lauge Larsen and Nadine Riedel.

Join us as we explore the impact of global financial transparency on tax compliance, revenue mobilisation, and tax administration in developing economies.