G20 Finance Ministers met and approved the new measures designed to coordinate efforts against tax avoidance by multinationals, according to an OECD release at their February 9-10 meeting in Istanbul.
OECD and the G20 countries have agreed to the three key elements that will enable implementation of its Base Erosion and Profit Sharing (BEPS) project:
- a mandate to launch negotiations on a multilateral instrument to streamline implementation of tax treaty-related BEPS measures
- implementation package for country-by-country reporting in 2016 and a related government-to-government exchange mechanism to start in 2017
- a criteria to assess whether preferential treatment regimes for intellectual property are harmful or not.
OECD BEPS action plan
The G20-OECD BEPS Action Plan sets out 15 pointsof international tax rules and treaties to be addressed by year-end 2015. The project aims to help governments protect their tax bases and offer increased certainty and predictability to taxpayers, while also preventing new local rules that result in double taxation, or restrict legitimate cross-border operations.
The implementation of the BEPS Action Plan will require modifications to the existing network of more than 3,000 bilateral tax treaties worldwide, which the OECD is now mandated to pursue.
The first meeting of the negotiating team is planned for July.
CTMfile take: In October we suggested that BEPS would role out slowy, but there is real energy and momentum behind OECD’s programme. They could well achieve their 2016 and 2017 targets.