The Organisation for Economic Cooperation and Development (OECD) today announced that Brazil, Guernsey, Jersey, the Isle of Man, and Latvia signed the Multilateral Competent Authority Agreement (MCAA) for the automatic exchange of country-by-country (CbC) reports.
The OECD's release notes that today's action brings the total number of signatories to the MCAA to 49, and that this represents a further milestone towards the implementation of the OECD/G20 base erosion and profit sharing (BEPS) project and cross-border cooperation on tax matters.
According to the OECD, the MCAA will enable implementation of new transfer pricing reporting standards developed under Action 13 of the BEPS action plan. With this, tax administrations will be able to obtain a complete understanding of the way multinational entities structure their operations, through the annual automatic exchange of CbC reports. It also will help to safeguard the confidentiality of taxpayer information. With CbC reporting, multinational entities will be required to provide aggregate information annually, in each jurisdiction where they do business, relating to the global allocation of income and taxes paid, together with other indicators of the location of economic activity within the taxpayer group. It will also cover information about which entities do business in a particular jurisdiction and the business activities of each entity.
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