OECD leading multilateral efforts to address tax challenges from digitalisation of the economy

digital1

(Carl Heyerdahl, Unsplash)

This article is brought to you in association with OECD.


Today the OECD Secretariat published a proposal to advance international negotiations to ensure large and highly profitable Multinational Enterprises, including digital companies, pay tax wherever they have significant consumer-facing activities and generate their profits.

The new OECD proposal brings together common elements of three competing proposals from member countries, and is based on the work of the OECD/G20 Inclusive Framework on BEPS, which groups 134 countries and jurisdictions on an equal footing, for multilateral negotiation of international tax rules, making them fit for purpose for the global economy of the 21st Century.
The proposal, which is now open to a public consultation process, would re-allocate some profits and corresponding taxing rights to countries and jurisdictions where MNEs have their markets. It would ensure that MNEs conducting significant business in places where they do not have a physical presence, be taxed in such jurisdictions, through the creation of new rules stating (1) where tax should be paid (“nexus” rules) and (2) on what portion of profits they should be taxed (“profit allocation” rules).
“We’re making real progress to address the tax challenges arising from digitalisation of the economy, and to continue advancing toward a consensus-based solution to overhaul the rules-based international tax system by 2020,” said OECD Secretary-General Angel Gurría. “This plan brings together common elements of existing competing proposals, involving over 130 countries, with input from governments, business, civil society, academia and the general public. It brings us closer to our ultimate goal: ensuring all MNEs pay their fair share.”
”Failure to reach agreement by 2020 would greatly increase the risk that countries will act unilaterally, with negative consequences on an already fragile global economy. We must not allow that to happen,” Mr Gurría said.
The Inclusive Framework’s tax work on the digitalisation of the economy is part of wider efforts to restore stability and certainty in the international tax system, address possible overlaps with existing rules and mitigate the risks of double taxation. Beyond the specific elements on reallocating taxing rights, a second pillar of the work aims to resolve remaining BEPS issues, ensuring a minimum corporate income tax on MNE profits. This will be discussed in a public consultation foreseen to take place in December 2019.
The ongoing work will be presented in a new OECD Secretary-General Tax Report during the next meeting of G20 Finance Ministers and Central Bank Governors in Washington DC, on 17-18 October.

Advertising

Advertising

Advertising

Advertising

Advertising

Advertising

the sting Milestone

Featured Stings

Can we feed everyone without unleashing disaster? Read on

These campaigners want to give a quarter of the UK back to nature

How to build a more resilient and inclusive global system

Stopping antimicrobial resistance would cost just USD 2 per person a year

Fighting for minds of youth in Latvia

Make the internet safer: stop using passwords

This new way of understanding disease is changing medicine

European Parliament marks EU accession prospects for Serbia and Kosovo

Yemen agreement to end southern power struggle ‘important step’ towards peace: UN Special Envoy

‘We all must step up’ collective action on disability inclusion – UN deputy chief

Federalist EU ‘naively’ believes Washington shares her TTIP high fever

Wide-ranging reforms needed to ensure Italy’s economic recovery

Mass measles vaccination campaign begins in Ebola-hit DR Congo province

‘Countless opportunities’ for new people-centred workplace, but ‘decisive action’ critical

Khashoggi case highlights ‘very worrying practice’ of overseas abductions, says UN expert

Japanese banks to move their European HQ from London to Frankfurt after Brexit

A ‘charismatic leader’ dedicated to making the world a better place for all: officials bid farewell to former UN chief Kofi Annan

ILO: Unemployment to increase by 8.1 million in 2013-2014

Eurozone recession subsides

The new North America trade deal USMCA punishes German cars

Russia must urgently step up fight against foreign bribery

The West – the EU and the US – is writing off Turkey’s Erdogan

UN conference agrees better ways for Global South countries to work together on sustainable development

Africa is creating one of the world’s largest single markets. What does this mean for entrepreneurs?

The race for Driverless vehicles: where is the industry heading?

World Pride underscores that all people are born ‘free and equal’ in dignity and human rights

4 things President Trump could learn from Jimmy Carter

Time to pay up: UN summit to push for development finance breakthrough

Accelerating a more sustainable industrial revolution with digital manufacturing

Public Policies for LGBT in Brazil

Schengen: MEPs ready for negotiations on temporary checks at national borders

What is digital equality? An interview with Nanjira Sambuli

European Young Innovators Forum @ European Business Summit 2014: Europe for StartUps, vision 2020

China, forever new adventures

Why cities hold the key to safe, orderly migration

The essence of care is cosmopolitan

Young health workforce – a core of effective primary healthcare?

Why Eurozone needs a bit more inflation

Tributes for ‘role model’ former UN refugee agency chief, Sadako Ogata

Draghi sees inflationary bubbles

Energy security: The synchronisation of the Baltic States’ electricity networks – European solidarity in action

Bahamas: ‘Clock is ticking’ to help those who lost everything in Hurricane Dorian, says UN

Which countries get the most sleep – and how much do we really need?

Energy: new target of 32% from renewables by 2030 agreed by MEPs and ministers

What the global Internet’s stakeholders can learn from Europe’s new data law

Joint OECD and World Bank report urges governments to improve resilience to disasters and related fiscal risks

Environment and health at increasing risk from growing weight of ‘e-waste’

Amsterdam is getting a 3D-printed bridge

How Greece was destroyed

Global Citizen-Volunteer Internships

4 innovation hotspots in the Arab world

Commission imposes a fine of €561 million on Microsoft

We are ‘burning up our future’, UN’s Bachelet tells Human Rights Council

EU tells Britain stay in as long as you wish

G20 LIVE: G20 Statement on the fight against terrorism

The Government of China and UNIDO partner to develop technical guidelines for standards of small hydropower development

Greece may offer to China a European gateway

Europe had a record year for Measles – and it’s partly down to anti-vaccine campaigners

Can the world take the risk of a new financial armageddon so that IMF doesn’t lose face towards Tsipras?

Easing funding woes for UN agency assisting Palestine refugees a ‘wise investment for today and the future’

‘Revved up climate action’ needed to counter ‘prolonged’ and deadly storms like Cyclone Idai: Guterres

To Brexit, or not to Brexit…rather not: 10 Downing Street, London

From diamonds to recycling: how blockchain can drive responsible and ethical businesses

International World Summit Award calls for outstanding digital applications with impact on society from 178 UN member states

More Stings?

Speak your Mind Here

Fill in your details below or click an icon to log in:

WordPress.com Logo

You are commenting using your WordPress.com account. Log Out /  Change )

Google photo

You are commenting using your Google account. Log Out /  Change )

Twitter picture

You are commenting using your Twitter account. Log Out /  Change )

Facebook photo

You are commenting using your Facebook account. Log Out /  Change )

Connecting to %s