Tackling the coronavirus: OECD Forum on Tax Administration publishes advice on business continuity considerations for tax administrations

The OECD Forum on Tax Administration (FTA), in collaboration with the Intra-European Organisation of Tax Administrations (IOTA) and the Inter-American Center of Tax Administrations (CIAT), has today published a reference document on critical business continuity considerations for tax administrations in the context of the COVID-19 pandemic. This document is based on input from across the membership of the three organisations. It recognises that the potential duration and severity of the current crisis brings unique challenges in managing the many different elements involved in ensuring continuity of vital tax administration functions as well as the safety of staff and taxpayers.

OECD/G20 Base Erosion and Profit Shifting Project. Prevention of Treaty Abuse – Second Peer Review Report on Treaty Shopping. INCLUSIVE FRAMEWORK ON BEPS: ACTION 6

OECD/G20 Base Erosion and Profit Shifting Project. Prevention of Treaty Abuse – Second Peer Review Report on Treaty Shopping. INCLUSIVE FRAMEWORK ON BEPS: ACTION 6. Action 6 of the BEPS Project identified treaty abuse, and in particular treaty shopping, as one of the principal sources of BEPS concerns. Owing to the seriousness of treaty shopping, jurisdictions have agreed to adopt, as a minimum standard, measures to address it, and to subject their efforts to an annual peer review. In 2018, the first peer review concluded that although few of the reported agreements met the minimum standard, many jurisdictions had begun in earnest to tackle the problem, principally by signing the multilateral instrument (MLI). This second peer review reveals that, by 30 June 2019, 91 Inclusive Framework members had begun to update the ir bilateral treaty network and were implementing the minimum standard. The data compiled for this peer review demonstrate that the MLI has been the tool used by the vast majority of jurisdictions that have begun to implement the minimum standard. By 30 June 2019, the MLI had already modified around 60 bilateral agreements. The MLI’s impact was expected to increase quickly as jurisdictions ratified it and that number has, as of 1 January 2020, increased to 180 bilateral agreements. Further, the MLI’s cover age is also expected to increase as other jurisdictions with a large network of tax treaties are considering joining it. The success of the MLI as a tool to implement Action 6 minimum standard is clear: by 1 January 2020, 93 jurisdictions had signed the MLI, 38 had ratified it, and it had modified 180 bilateral tax treaties. Once all signatories have ratified the MLI, around 65% of all agreements between Inclusive Framework members will be modified by the MLI to include the minimum standard (and other BEPS treaty related provisions). Other jurisdictions have expressed interest in signing the MLI and, if all waiting agréments become covered tax agreements, this figure could be as high as 85%. In light of the experience in conducting the peer reviews, the peer review methodology will be reviewed in 2020.

OECD – FORUM ON TAX ADMINISTRATION – TAX ADMINISTRATION  RESPONSES TO COVID -19: SUPPORT FOR TAXPAYERS

OECD – FORUM ON TAX ADMINISTRATION – TAX ADMINISTRATION  RESPONSES TO COVID -19: SUPPORT FOR TAXPAYERS. The Covid -19 emergency will affect the lives of many people around the globe. There are a number of ways that governments and tax administrations can ease burdens on Taxpayers and support businesses and individuals with cash-flow problems or with difficulties in meeting tax reporting or payment obligations. The suggestions below are not recommendations but are intended to assist administrations globally in their consideration of appropriate measures in their own national contexts to help taxpayers during this difficult period. Not all of these possibilities will be currently available to all tax administrations and may need legislative changes. 16 March 2020.

OECD – EMERGENCY TAX POLICY RESPONSES TO THE COVID -19 PANDEMIC

OECD – EMERGENCY TAX POLICY RESPONSES TO THE COVID -19 PANDEMIC. LIMITING DAMAGE TO PRODUCTIVE POTENTIAL AND PROTECTING THE VULNERABLE. Emergency tax policy responses to the Covid -19 pandemic limiting damage to productive potential and protecting the vulnerable detected cases of Covid-19 are quickly rising in many countries, with major adverse effects on health and mortality. To fight the outbreak and spread of the virus, countries are imposing unprecedented measures. The result is that Economic activity has decreased sharply in many countries and greater uncertainty has eroded confidence. In the face of this crisis, the immediate priority is to respond quickly to support households and improve liquidity for businesses to keep the productive capacity of economies intact as much as possible. A range of tax policy and tax administration measures could be considered by governments. These potential measures, which are not recommendations but are intended to assist policymakers as they respond in their own national context, include: (…) 20 March 2020.

OECD – Transfer Pricing in Brazil: Towards Convergence with the OECD Standard

This report is an outcome of the joint project on transfer pricing between OECD and Receita Federal do Brasil (RFB). It contains the findings of the in-depth analysis of similarities and differences between the transfer pricing framework currently in place in Brazil as compared to the OECD guidance (OECD Transfer Pricing Guidelines for Multinational Enterprise and Tax Administrations), which is the international consensus on transfer pricing. The report also explores the options for Brazil to converge with the OECD transfer pricing standard while enhancing the positive attributes of the existing framework. In February 2018, the OECD and Brazil launched a joint project to examine the similarities and divergences  between the Brazilian and OECD transfer pricing approaches to valuing cross – border transactions between associated enterprises for tax purposes. This initiative builds on Brazil’s robust engagement in the OECD’s tax work, which began in 2010 when it joined the Global Forum on Transparency and Exchange of Information for Tax Purposes, and was further strengthened in 2013 when it became a member of the G20/OECD Project to counter Base Erosion and Profit Shifting (BEPS), which had a substantial focus on transfer pricing. Beyond just taxation, in 2017, Brazil also expressed interest in initiating the process to join the OECD. Objective: assessing the strengths and weaknesses of Brazil’s transfer pricing framework The 15 – month work programme carried out by the OECD jointly with Receita Federal do Brasil (RFB) included an in depth analysis of the Brazilian transfer pricing legal and administrative framework as well  as its application. Based on the assessment of its strengths and weaknesses, possible options were explored for Brazil’s alignment with the OECD internationally accepted transfer pricing standard, using the OECD Transfer Pricing Guidelines and other relevant OECD guidance as a reference for the analysis.

OECD – CORPORATE TAX STATISTICS. FIRST EDITION

OECD – CORPORATE TAX STATISTICS. FIRST EDITION. The Corporate Tax Statistics database is intended to assist in the study of corporate tax policy and expand the quality and range of data available for the analysis of base erosion and profit shifting (BEPS). In developing this first edition of the database, the OECD has worked closely with members of the Inclusive Framework on BEPS (Inclusive Framework) and other jurisdictions willing to participate in the collection and compilation of statistics relevant to corporate taxation. The 2015 Measuring and Monitoring BEPS, Action 11 report highlighted that the lack of quality data on corporate taxation is a major limitation to the measurement and monitoring of the scale of BEPS and the impact of the OECD/G20 BEPS project. While this database is of interest to policy makers from the perspective of BEPS, its scope is much broader. Apart from BEPS, corporate tax systems are important more generally in terms of the revenue that they raise and the incentives for investment and innovation that they create. The Corporate Tax Statistics database brings together a range of valuable information to support the analysis of corporate taxation, in general, and of BEPS, in particular. The database compiles new data items and statistics currently collected and stored by the OECD in various existing data sets. The first edition of the database contains four main categories of data: l corporate tax revenues; l statutory corporate income tax rates; l corporate effective tax rates; l tax incentives related to innovation. Future editions will also include an important new data source: aggregated and anonymised statistics of data collected under the BEPS Action 13 Country-byCountry Reports.

OECD/G20 Base Erosion and Profit Shifting Project. HARMFUL TAX PRACTICES – 2017 PEER REVIEW REPORTS ON THE EXCHANGE OF INFORMATION ON TAX RULINGS. INCLUSIVE FRAMEWORK ON BEPS: ACTION 5

OECD/G20 Base Erosion and Profit Shifting Project. HARMFUL TAX PRACTICES – 2017 PEER REVIEW REPORTS ON THE EXCHANGE OF INFORMATION ON TAX RULINGS. INCLUSIVE FRAMEWORK ON BEPS: ACTION 5. The integration of national economies and markets has increased substantially in recent years, putting a strain on the international tax rules, which were designed more than a century ago. Weaknesses in the current rules create opportunities for base erosion and profit shifting (BEPS), requiring bold moves by policy makers to restore confidence in the system and ensure that profits are taxed where economic activities take place and value is created. Following the release of the report Addressing Base Erosion and Profit Shifting in February 2013, OECD and G20 countries adopted a 15-point Action Plan to address BEPS in September 2013. The Action Plan identified 15 actions along three key pillars: introducing coherence in the domestic rules that affect cross-border activities, reinforcing substance requirements in the existing international standards, and improving transparency as well as certainty. After two years of work, measures in response to the 15 actions were delivered to G20 Leaders in Antalya in November 2015. All the different outputs, including those delivered in an interim form in 2014, were consolidated into a comprehensive package. The BEPS package of measures represents the first substantial renovation of the international tax rules in almost a century. Once the new measures become applicable, it is expected that profits will be reported where the economic activities that generate them are carried out and where value is created. BEPS planning strategies that rely on outdated rules or on poorly co-ordinated domestic measures will be rendered ineffective. Implementation is now the focus of this work. The BEPS package is designed to be implemented via changes in domestic law and practices, and in tax treaties. With the negotiation of a multilateral instrument (MLI) having been finalised in 2016 to facilitate the implementation of the treaty related BEPS measures, over 80 jurisdictions are covered by the MLI. The entry into force of the MLI on 1 July 2018 paves the way for swift implementation of the treaty related measures. OECD and G20 countries also agreed to continue to work together to ensure a consistent and co-ordinated implementation of the BEPS recommendations and to make the project more inclusive. Globalisation requires that global solutions and a global dialogue be established which go beyond OECD and G20 countries. A better understanding of how the BEPS recommendations are implemented in practice could reduce misunderstandings and disputes between governments. Greater focus on implementation and tax administration should therefore be mutually beneficial to governments and business. Proposed improvements to data and analysis will help support ongoing evaluation of the quantitative impact of BEPS, as well as evaluating the impact of the countermeasures developed under the BEPS Project. As a result, the OECD established the Inclusive Framework on BEPS, bringing all interested and committed countries and jurisdictions on an equal footing in the Committee on Fiscal Affairs and all its subsidiary bodies. The Inclusive Framework, which already has more than 120 members, is monitoring and peer reviewing the implementation of the minimum standards as well as completing the work on standard setting to address BEPS issues. In addition to BEPS members, other international organisations and regional tax bodies are involved in the work of the Inclusive Framework, which also consults business and the civil society on its different work streams. This report was approved by the Inclusive Framework on BEPS on 13 November 2018 and prepared for publication by the OECD Secretariat.

OECD – MAP Statistics Reporting Framework. BEPS Action 14. The Report on Action 14: Making Dispute Resolution Mechanisms More Effective (“the 2015 Action 14 Report”) was approved by the OECD Committee of Fiscal Affairs (“CFA”) in September, presented to the OECD Council and endorsed by the G20 Finance Ministers on 8 October 2015. This Report contained a commitment by countries engaged in the work to the implementation of a minimum standard to ensure that they resolve treaty-related disputes in a timely, effective and efficient manner and to have their compliance with the minimum standard reviewed by their peers – i.e. the ot her members of the Forum on Tax Administration MAP Forum (“the FTA MAP Forum”). One of the elements of the minimum standard requires jurisdictions to seek to resolve mutual agreement procedure (“MAP”) cases within an average time frame of 24 months. To monitor compliance with this, jurisdictions’ progress toward meeting this target will be periodically reviewed on the basis of the statistics prepared in accordance with an agreed reporting framework. The 2015 Action 14 Report explains that the reporting framework will include agreed milestones for the initiation and conclusion/closing of a MAP case, as well as other relevant stages of the MAP process. The minimum standard also requires jurisdictions to provide timely and complete reporting of MAP statistics, pursuant to the agreed reporting framework. The agreed reporting framework is set out in this note. Section II describes the MAP process to the extent it is relevant for MAP statistics reporting purposes, in particular focusing on the relevant milestones. Section III sets out the statistics reporting templates for the reporting and publication of MAP case inventory and MAP outcomes, and the average time taken for each of the key stages of the MAP process, including the definition of terms used.

OECD – MAP Statistics Reporting Framework. BEPS Action 14. The Report on Action 14: Making Dispute Resolution Mechanisms More Effective (“the 2015 Action 14 Report”) was approved by the OECD Committee of Fiscal Affairs (“CFA”) in September, presented to the OECD Council and endorsed by the G20 Finance Ministers on 8 October 2015. This Report contained a commitment by countries engaged in the work to the implementation of a minimum standard to ensure that they resolve treaty-related disputes in a timely, effective and efficient manner and to have their compliance with the minimum standard reviewed by their peers – i.e. the ot her members of the Forum on Tax Administration MAP Forum (“the FTA MAP Forum”). One of the elements of the minimum standard requires jurisdictions to seek to resolve mutual agreement procedure (“MAP”) cases within an average time frame of 24 months. To monitor compliance with this, jurisdictions’ progress toward meeting this target will be periodically reviewed on the basis of the statistics prepared in accordance with an agreed reporting framework. The 2015 Action 14 Report explains that the reporting framework will include agreed milestones for the initiation and conclusion/closing of a MAP case, as well as other relevant stages of the MAP process. The minimum standard also requires jurisdictions to provide timely and complete reporting of MAP statistics, pursuant to the agreed reporting framework. The agreed reporting framework is set out in this note. Section II describes the MAP process to the extent it is relevant for MAP statistics reporting purposes, in particular focusing on the relevant milestones. Section III sets out the statistics reporting templates for the reporting and publication of MAP case inventory and MAP outcomes, and the average time taken for each of the key stages of the MAP process, including the definition of terms used.

OECD Secretary-General Tax Report to G20 Finance Ministers and Central Bank Governors

OECD Secretary-General Tax Report to G20 Finance Ministers and Central Bank Governors. Riyadh, Saudi Arabia. February 2020. Overview Over the past 10 years, the G20 has supported multilateral co-operation for a globally fair, sustainable and modern international tax system, which translated in to successful deliverables. Thanks to this momentum, significant progress has taken place to combat tax evasion, Base Erosion and Profit Shifting (BEPS), and ensure that all economies benefit from these developments. As per your mandate, the urgent priority is now to reach a consensus-based solution to address the tax challenges arising from the digitalisation of the economy by the end of 2020. During the second half of 2019, political tensions around unilateral measures mounted and provided a glimpse of the difficulties that would arise should progress on finding a global solution by the end of 2020 hit a standstill. These tensions highlight again the urgency to advance the multilateral negotiations. The year 2020 got off to an encouraging start. On 29-30 January 2020 at their plenary meeting, the 137 countries and jurisdictions of the G20/OECD Inclusive Framework on BEPS (hereafter G20/OECD IF) reaffirmed their commitment to reach a consensus -based solution and endorsed the “Outline of the Architecture of a Unified Approach on Pillar One.” For almost two years, the G20/OECD IF had been considering three competing proposals under Pillar One. Such proposals related to new rules on where MNEs should pay tax (“nexus” rules) and on what portion of profits they should be taxed (“profit allocation” rules). In order to unlock the conversation, the OECD Secretariat released its proposed “Unified Approach” in October 2019 1, which drew on certain elements from the previous proposals and includes new nexus and profit allocation rules. This work continues not without difficulties, and some of the 137 members have divergent views on how best to address the tax challenges arising from digitalisation.