The Organisation for Economic Cooperation and Development (OECD) on 23 January 2018 announced a new pilot program for multilateral risk assessment of large multinational entity (MNE) groups. The pilot program—the International Compliance Assurance Program—is a voluntary program that will use country-by-country (CbC) reports and other information to facilitate open and co-operative multilateral engagements between MNE groups and tax administrations. The goal is to provide early tax certainty and assurance for both taxpayers and tax administrations.
As noted in an OECD release, the coordination of conversations between an MNE group and tax administrations will be based on effective use of transfer pricing information—including the information included in the MNE group's CbC report, Master file and Local file. It is intended that more efficient use of resources both for the MNE group and for tax administrations will result in fewer cases entering into mutual agreement proceedings (MAP).
The tax administrations of eight countries—Australia, Canada, Italy, Japan, the Netherlands, Spain, the United Kingdom, and the United States—are participating in the launch of the pilot program. A multilateral assessment of specific international tax risks posed by each MNE group in the pilot program is scheduled to begin during the first half of 2018 and to be completed within 12 months.
The KPMG logo and name are trademarks of KPMG International. KPMG International is a Swiss cooperative that serves as a coordinating entity for a network of independent member firms. KPMG International provides no audit or other client services. Such services are provided solely by member firms in their respective geographic areas. KPMG International and its member firms are legally distinct and separate entities. They are not and nothing contained herein shall be construed to place these entities in the relationship of parents, subsidiaries, agents, partners, or joint venturers. No member firm has any authority (actual, apparent, implied or otherwise) to obligate or bind KPMG International or any member firm in any manner whatsoever. The information contained in herein is of a general nature and is not intended to address the circumstances of any particular individual or entity. Although we endeavor to provide accurate and timely information, there can be no guarantee that such information is accurate as of the date it is received or that it will continue to be accurate in the future. No one should act on such information without appropriate professional advice after a thorough examination of the particular situation. For more information, contact KPMG's Federal Tax Legislative and Regulatory Services Group at: + 1 202 533 4366, 1801 K Street NW, Washington, DC 20006.