The CRS is a tax information exchange among countries who collect information from their financial institutions and pass them on to other countries who would check whether the person reported has paid their taxes. Greece is a signatory of the CRS and supposed to send and receive tax information starting 2017. However, if the Greek government exited the EURO it would be technically impossible to exchange data.
The CRS, unlike other conventions, does not only prescribe the legal obligations of the signatories, but also in great detail, how to exchange the account data. For that purpose, the OECD has developed an XML schema which clearly defines how and what to report. This schema however does not know the Drachma which the Greek government might introduce after a grexit. The information, the Greek finance ministry delivered to another government, would be rejected as not compliant with the XML schema.
Even without plans for a modification of the XML schema, eventually the OECD will need to update it. Similar needs to update might arise not only when a country introduces a new currency, but also when countries split up. Scotland comes to mind. Assuming that the Scots are taking over the task of reporting accounts according to the CRS, their reports equally would be rejected, since the country code for Scotland is not part of the XML schema. Taxpayers trying to avoid reporting under CRS might consider buying gold in the hope that gold is not a currency that could not be reported. Unfortunately the OECD has foreseen codes for the reporting of gold directly without conversion into dollars. If there is a third world country that holds accounts in livestock, CRS reporting might be challenging. Short of cows, the OECD has only excluded bitcoins from the list of available currencies. The OECD needs to adapt the XML schema at one point, the question is when.
At this point, if Greece introduced the Drachma or the Scots voted to become independent, technology as prescribed by the OECD prevented any reporting. Let’s see how many tax evaders are flocking to Scotland or the warmer climes of Greece.
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