On October 16 at the BRICS summit, the BRICS countries stressed the need for a mutually acceptable mechanism among BRICS nations to fight tax avoidance. The countries also agreed to set up an independent rating agency based on market-oriented principles to further strengthen global financial architecture.
As the BRICS countries previously expressed their concerns against the working of the rating market, currently controlled by the Big Three - S&P, Fitch and Moody's - all based in the US, the idea of creating an independent rating agency had been born. At the summit, the BRICS countries welcomed experts exploring the possibilities of setting up an independent BRICS Rating Agency based on market-oriented principles. Accordingly, the agency would "strengthen the global governance architecture," the countries said in a joint statement.
The countries also welcomed the reports of BRICS Think Tanks Council and BRICS Academic Forum that have emerged as valuable platforms for our experts to exchange views. The countries also stressed the importance of BRICS institution-building in order to transform the global financial architecture to one based on the principles of fairness and equity.
The leaders note that aggressive tax planning and tax practices hurt equitable development and economic growth. They affirmed that profit should be taxed in the jurisdiction where the economic activity is performed and the value is created, and expressed full support of BEPS implementation.
India’s Prime Minister Modi said, "Our agencies must also build mechanisms of information sharing to bring to justice the tax offenders and money launderers. BRICS should push for empowering the global governance institutions to reflect today's reality."
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