OECD develops exchange framework for digital platform tax reporting

By Doug Connolly, MNE Tax

The OECD sets out in a June 22 report a multilateral competent authority agreement for the automatic exchange of information relating to income derived by sellers of certain services through digital platforms such as Uber and Airbnb.

The report also includes an optional extension of the scope of such reporting to cover additional types of services and sales beyond those covered in the OECD’s model reporting rules for digital platforms released last year.

Under the model rules for reporting by digital platforms released by the OECD in June 2020, operators of digital platforms would be required to collect information on income realized by certain sellers on their platforms and report that information to tax authorities.

The competent authority agreement would be used to implement the exchange of information by the platform operator’s residence jurisdiction with the residence jurisdiction of the sellers operating on the platform.

As initially devised, the model rules would apply the reporting requirements only with respect to sellers offering accommodations, transportation, and personal services through digital platforms.

However, in response to jurisdictions’ interest in extending the reporting to additional types of sellers, the new OECD reporting framework includes an optional extended scope to cover the sales of goods and the rental of means of transportation in addition to the previously covered types of sales.

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Doug Connolly

Editor-in-Chief at MNE Tax

Doug Connolly is Editor-in-Chief of MNE Tax. He has more than 10 years of experience covering tax legal developments, previously working with both a Big Four firm and a leading legal publisher. He holds a law degree from American University Washington College of Law.

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