With a number of important recent and upcoming developments in the OECD's international tax work, we invite you to join the OECD's Centre for Tax Policy and Administration (CTPA) for the latest tax update. Topics include: 1. G20 2. Inclusive Framework on BEPS, including the Multilateral Instrument 3. Tax transparency 4. Tax certainty 5. VAT/GST

1. OECD TAX TALKS
28 March 2017
15:00 – 16:00 (CEST)
CENTRE FOR TAX POLICY
AND ADMINISTRATION

2. Join the discussion
Ask questions and comment throughout the
webcast
CTP.Contact@oecd.org
#OECDTaxTalks
2

3. Topics
1. G20
2. Inclusive Framework on BEPS, including
the Multilateral Instrument
3. Tax transparency
4. Tax certainty
5. VAT/GST
3

4. G20 Finance Ministers
Baden-Baden, March 2017
1. “We remain committed to (…) the Base Erosion and
Profit Shifting (BEPS) package (…)
2. We look forward to the OECD's preparation of a list by
the Leaders Summit in July 2017 (…).
3. We acknowledge the report on Tax Certainty submitted
to us (…). We ask the OECD and the IMF to assess
progress in enhancing tax certainty in 2018 (…).
4. We have undertaken a discussion on the implications of
digitalisation for taxation (…). We will further work on
this issue through the TFDE and ask for an interim report
by the Spring Meetings 2018.”
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5. UPDATE ON THE INCLUSIVE
FRAMEWORK ON BEPS

6. The Inclusive Framework
25%
21%
54%
94 members
OECD
G20
OTHERS
New Steering Group members:
Egypt and Jamaica
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33%
19%12%
19%
17%
New members – regional balance*
Africa
Asia-Pacific
Eastern Europe-
Central Asia
Latin America &
Caribbean
Western Europe
*Excluding OECD and G20

7. Minimum standards: Implementation, implementation, implementation…
Inclusive Framework Activities
Action 5
Counter harmful tax
practices
Action 6
Prevent treaty abuse
Action 13
Country-by-country
reporting
Action 14
Dispute resolution
BEPS Actions
Terms of reference /
methodology approved Peer review started

2017



2015 (Regimes)
Jan. 2017 (Transparency)
 Feb. 2017
 Dec. 2016
–
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8. Action 5
Counter harmful tax
practices
Action 6
Prevent treaty abuse
Action 13
Country-by-country
reporting
Action 14
Dispute resolution
BEPS Actions Status and first results
• Preferential tax regimes:
– More than 90 regimes from 46 jurisdictions under review
– Over 10 IP regimes already abolished or made
consistent with the modified nexus approach
• Transparency framework for rulings:
– Over 6,000 exchanges on rulings by year-end 2016
– 44 jurisdictions from OECD and G20 currently
undergoing peer reviews
Inclusive Framework Activities
8

9. Action 5
Counter harmful tax
practices
Action 6
Prevent treaty abuse
Action 13
Country-by-country
reporting
Action 14
Dispute resolution
BEPS Actions Status and first results
• Domestic framework:
– Over 45 jurisdictions already have primary and / or secondary legislation in place
– EU Directive already approved in 2016
• Exchange of information network:
– 57 signatories of the CbC MCAA, more to come
– Activations of bilateral relationships underway
• Guidance:
– Guidance published in June and December 2016
– More guidance to come
– Questions of interpretation and technical issues currently examined to assist
jurisdictions and MNE Groups
Inclusive Framework Activities
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10. Action 5
Counter harmful tax
practices
Action 6
Prevent treaty abuse
Action 13
Country-by-country
reporting
Action 14
Dispute resolution
BEPS Actions Status and first results
1st batch
By Dec. 2016
2nd batch
By March
2017
3rd batch
By August
2017
4th batch
By Dec. 2017
5th batch
By April 2018
6th batch
By August
2018
7th batch
By Dec. 2018
8th batch
By April 2019
Belgium Austria
Czech
Republic
Australia Estonia Argentina Brazil Brunei
Canada France Denmark Ireland Greece Chile Bulgaria Curacao
Netherlands Germany Finland Israel Hungary Colombia China Guernsey
Switzerland Italy Korea Japan Iceland Croatia
Hong Kong
(China)
Isle of Man
United
Kingdom
Liechtenstein Norway Malta Romania India Indonesia Jersey
United States Luxembourg Poland Mexico
Slovak
Republic
Latvia
Papua New
Guinea
Monaco
Sweden Singapore New Zealand Slovenia Lithuania Russia San Marino
Spain Portugal Turkey South Africa Saudi Arabia
Inclusive Framework Activities
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11. Inclusive Framework Activities
Action 5
Counter harmful tax
practices
Action 6
Prevent treaty abuse
Action 13
Country-by-country
reporting
Action 14
Dispute resolution
BEPS Actions Status and first results
• Publication of batch 1 reports expected in
July/August 2017
• On-going peer input
• On-going taxpayer input invited from taxpayers and
associations on MAP access, clarity of guidance
and timely implementation of MAP agreements
• Unique opportunity – use it or lose it
11

12. MLI status update
• Speed matching 27 February – 2 March:
– 55 delegations and 300+ meetings
• Countries are on track:
– Countries are working on their reservations and notifications
– Secretariat support through MLI workshops and bilateral
assistance
• More than 25 intend to opt in for Part VI (Mandatory Binding
Arbitration)
• Signing ceremony on 7 June
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13. Ongoing: Transfer pricing
WP6 in its Inclusive Framework format is working on revised guidance on:
Attribution of profits to PEs. The aim is to:
• Clarify that there is no double taxation issue in source countries
• Minimise compliance and administrative burden
• Seek further clarification on the interaction between Art. 7 and 9
Use of transactional profit split (TPS) method. The aim is to clarify:
• When is the TPS method the most appropriate method
• How can the TPS method be applied in particular circumstances
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14. Ongoing: Transfer pricing
In addition, WP6 is working on:
• Implementation guidance on the approach to Hard-to-Value Intangibles,
and
• Guidance on the transfer pricing of financial transactions
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Public discussion drafts on all projects by mid-2017

15. Ongoing: Transfer pricing
OECD Council expected to adopt soon:
• Revised Chapter IX; and
• Revised 1995 Council Recommendation
15
2017
To be included in the 2017
consolidated version of the OECD
TP Guidelines

16. TAX TRANSPARENCY

17. G20 listing process (1)
“List… of those jurisdictions that have not yet sufficiently progressed towards a satisfactory level of
implementation of the agreed international standards on tax transparency”
CRITERIA - At least two of three :
i. At least a “largely compliant” rating with respect to the EOIR Standard;
ii. A commitment to implement the AEOI Standard, with first exchanges in 2018 (with respect
to the year 2017) at the latest;
iii. Participation in the multilateral Convention or a sufficiently broad exchange network
permitting both EOIR and AEOI.
HOWEVER, even if a jurisdiction meets at least two of the three criteria, it will still be listed if it is “non-compliant”
under the Global Forum peer review process, or is blocked from moving past Global Forum Phase 1 or where it is
previously blocked from moving past Phase 1 and has not yet received an overall rating under Phase 2.
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18. G20 listing process (2)
A fast-track process is made available by the Global Forum on Tax
Transparency and Exchange of Information to jurisdictions at risk of being
listed:
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• Will allow the recognition of progress made since the last review ahead of
G20 Summit in July 2017;
• Is a simplified but robust review against the 2010 Terms of Reference;
• Will provide a provisional rating for the purpose of the listing process; and
• Will be confirmed by a full peer review against the 2016 Terms of Reference
launched by end 2017.

19. Automatic Exchange of Information
Deadlines 2017/2018 fast approaching
Domestic implementation International implementation
2017
On-track
2018
Domestic reporting
laws to be put in place
ASAP where not
already done so
MAC: 108 signatories, more to come
CRS MCAA: 87 signatories, more to come
Activated exchange relationships: 1400+ and counting
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 
Confidentiality is key
• Almost all 100 committed jurisdictions already assessed
• Where gaps are identified assistance is provided

20. Automatic Exchange of Information
• AEOI evaluations are initially following a staged approach looking at
key risk areas
• This includes confidentiality standards, domestic reporting
legislation and networks of exchange agreements
• Methodology and Terms of Reference under development
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21. • Standardised and secure transmission system for bilateral
exchanges
• CRS, CbC (BEPS Action 13)
and Rulings (BEPS Action 5)
• Now moving from build to testing stage
• Scheduled to be ready for first exchanges in September 2017
• Open to all Global Forum and Inclusive Framework members
Common Transmission System
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22. TAX CERTAINTY

23. Tax certainty
• Report on tax certainty1 delivered to G20 Finance
Ministers with IMF (March 2017)
• “We welcome the … work on tax certainty conducted
by the OECD and the IMF. We acknowledge the
report on Tax Certainty submitted to us and
encourage jurisdictions to consider voluntarily the
practical tools for enhanced tax certainty as
proposed in that report, including with respect to
dispute prevention and dispute resolution to be
implemented within domestic legal frameworks and
international tax treaties.”
• “We ask the OECD and the IMF to assess
progress in enhancing tax certainty in 2018”
1. www.oecd.org/tax/g20-report-on-tax-certainty.htm 23

24. • Between 18 October and 16 December 2016
• 724 completed responses
• Firms with global HQ in 62 countries
• Regional HQs in 105 jurisdictions
• Turnover: total of USD 17 trillion
• 99% of turnover in FT Global 500
• 50% are multinational firms
• 66% tax director or senior tax managers
The OECD business survey
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25. Top 10 sources on uncertainty
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26. Possible solutions
• Multilateral Advance Pricing Agreements
– 36% of respondents say very important and extremely important
– This figure is 44% when we only consider MNEs
• Multilateral audits
– 25% of respondents say very important and extremely important
• Multilateral co-operative compliance programmes
– 31% of respondents say very important and extremely important.
– This figure is 36% when we only consider MNEs
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27. What’s next?
1. Forum on Tax Administration’s work on co-operative
compliance and dispute prevention
2. Implementation of BEPS Action 14 and work on
arbitration (with the Multilateral Instrument)
3. Follow-up to report back to the G20 in 2018
27

28. VAT/GST

29. • Standards for the VAT/GST treatment of international trade
• First “OECD Act” in the area of VAT/GST
• Open to adherence by non-Member countries
• 100+ delegations – Approx. 300 delegates
• Broadening and deepening international consensus on VAT/GST design and
operation
The International VAT/GST Guidelines have been
adopted as an OECD Recommendation
VAT/GST Recommendation will be released
at the Global Forum on VAT in Paris on 12-14 April 2017
VAT/GST Recommendation
29

30. • Flagged as key issue in the context of BEPS Action 1
• 2015 Action 1 Report recommends that offshore sellers should remit VAT/GST in
the consumers’ jurisdiction
• Implementation mechanisms: in the VAT/GST Guidelines
• Australia, EU-28, India, New Zealand, Japan, Korea, Norway, Russian
Federation, South Africa …
Mechanisms for the collection of VAT/GST on digital “business-to-consumer”
sales by offshore vendors
These mechanisms are being implemented globally
Focus now on practical implementation packages
VAT/GST and BEPS Action 1
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31. WHAT’S NEXT?

32. Next steps
• Annual report on the Inclusive Framework on
BEPS, July 2017
• BEPS Peer Reviews
• Global Forum fast track process
• First automatic exchanges under CRS
• Task Force on the Digital Economy
32

33. QUESTIONS?

34. Join the discussion
34
Ask questions and comment throughout the
webcast
CTP.Contact@oecd.org
#OECDTaxTalks