Abstract

In an ambitious attempt to curb offshore tax evasion, more than 100 countries, including all major tax havens, have recently started to exchange bank account information on an automatic basis. Using administrative data from Denmark, we study to what extent the policy has improved tax compliance through three channels: (i) repatriation from accounts in tax havens; (ii) increased self-reporting of foreign financial income; (iii) improved audits of taxpayers with foreign accounts. The preliminary results shows a significant repatriation of wealth from tax havens before the onset of the information exchange, predominantly by taxpayers with large offshore accounts, and a striking surge in self-reports of foreign financial income around the onset of the information, predominantly by taxpayers with small foreign incomes.