By Julie Martin, MNE Tax
The preliminary results of an impact assessment reveal that proposals advanced in an OECD-led effort to update the global rules for taxing digital businesses would not create large changes to countries’ existing taxing rights, Pascal Saint-Amans, OECD Director of the Centre for Tax Policy and Administration, said September 11.
“What we are talking about, depending on the hypotheses you make, it’s not a massive shift,” the OECD tax director said during a Bloomberg Tax interview that was recorded as a podcast.
Saint Amans said that the impact assessment’s final results will not be published until year-end because the project is such a large undertaking.
Countries need to “relax,” Saint Amans said, because the goal of the OECD-led international tax rewrite is not to create winners or losers.
Saint Amans said that the next step toward reaching consensus on a new global international tax and transfer pricing rules is for countries to reach political agreement to turn the three “pilar one” proposals into one unified proposal that can become the basis for negotiations. The pillar one proposals provide updated rules for allocating multinational group profit between countries to give a greater share to the countries where customers or digital businesses’ users reside.
The OECD Secretariat will provide an update on the digital tax work to the G20 for its approval next month, Saint Amans said. This will include the OECD’s ideas of what a unified approach could be.
Saint Amans said that the OECD is seeking also to reach agreement among countries on a binding cross border tax dispute resolution mechanism. He acknowledged that some countries are opposed to binding arbitration and said the goal is to find something equivalent.
Julie Martin
Julie Martin is the founder of MNE Tax. She edits the publication and regularly contributes articles on new developments in cross-border business taxation.
Julie has worked as a tax journalist and editor for more than 13 years. Prior to that, she worked as an in-house tax attorney in New York. She also holds an LLM in taxation from New York University School of Law.
Julie can be reached at [email protected].
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