The webcast gave an update on the OECD’s work on various international tax topics.
The latest OECD Tax Talks webcast was held on 28 March 2017, with their Centre for Tax Policy and Administration (CTPA) giving an update on the various international tax work that the OECD contributes to. The webcast covered the recent G20 Finance Ministers meeting, an update on the Inclusive Framework on BEPS (including the Multilateral Instrument), tax transparency, tax certainty, and VAT/GST. In this article, we cover the key points from the webcast.
G20 Finance Ministers meeting
At the meeting, the G20 Finance Ministers restated their commitment to the implementation of the BEPS project. It was also the first meeting attended by the new US Treasury Secretary Steven Mnuchin, who recognised the work of the group on tax and BEPS.
Following the OECD and IMF’s joint report on tax certainty, the G20 have given them a mandate to report back on progress on a country by country basis. They have also highlighted their will to see further work on tax and the digitisation of the economy – the OECD plan to release an interim report on this in Spring 2018 with the final report due in 2020.
The next G20 Finance Ministers meeting will be in July 2017.
Update on the Inclusive Framework on BEPS and the Multilateral Instrument (MLI)
The Framework now has 94 members committed to the BEPS package. In addition, the steering group has been expanded to 20 members. Following a meeting of the Framework plenary, the OECD will prepare an annual report back to the G20.
The focus to date on the peer reviews has been on the minimum standards, with the peer review frameworks for BEPS Actions 5, 13 and 14 having been agreed.
The MLI was also mentioned, with a ‘speed matching’ event having been held to allow more than 300 meetings between pairs of countries to discuss their positions. In addition, the Secretariat is holding workshops and providing bilateral assistance. Many participating countries are on track to sign the MLI by 7 June 2017.
Update on Transfer Pricing
A lot of work has been happening on BEPS Actions 7 and 8 -10. In particular, the OECD has been looking at the permanent establishment changes to ensure there will be no double tax implications, and has been preparing administrative guidance to minimise the compliance burden for taxpayers and tax administrations.
Draft revised guidance on the use of Profit Split methodologies and draft guidance for implementation for ‘Hard to Value’ intangibles and financial and funding transactions within multinationals will be issued in the coming months, and the 2017 version of the TP Guidelines will be issued later this year.
Tax transparency and information sharing
While the number of countries on the G20’s ‘non-compliant’ list is expected to be minimal, countries that are compliant will need to show that they are making a real commitment to implementing the requirements on tax transparency.
Much of the data of the report was gathered through the OECD Business Survey, and it shows a particular focus on dispute prevention and resolution.
The main sources of tax uncertainty were reported as: too much bureaucracy, inconsistent treatment from tax authorities, lengthy decision making by the tax courts, and tax complexity.
Future OECD work on tax certainty will seek to improve dispute resolution and dispute prevention, promote bilateral APAs and audits, improve mutual assistance procedures, and move towards a multi-lateral co-operative compliance approach.
Around 100 countries have now signed up to the OECD GST guidelines, including non-member countries. With more digital providers now delivering services to overseas consumers, the OECD is seeing more countries implement regimes to collect VAT from foreign sellers.
To listen to the webcast, click here.
For further information please contact :