The OECD has published a progress report detailing whether countries are meeting their commitments to amend or abolish tax regimes considered “harmful,” including tax regimes that have no “substance.”
Moreover, it was announced that low-tax and no-tax countries will soon be assessed to see if they meet agreed-to substance requirements.
The January 29 report details assessments of tax regimes conducted by the Forum on Harmful Tax Practices (FHTP) and approved by an OECD-led coalition of over 120 nations interested in curtailing MNE group tax avoidance, called the “Inclusive Framework on BEPS.”
This latest assessment by the FHTP makes 80 decisions on 57 regimes. Since the beginning of the base erosion profit shifting (BEPS) project, the group has reviewed 255 regimes from 70 jurisdictions around the world.
The report concludes that all intellectual property regimes identified in the 2015 BEPS action 5 report are no longer harmful as they are consistent with the internationally agreed-to nexus approach.
It also found that three Thailand regimes were “potentially harmful.”
Further, the following countries were said to have changed or abolished tax regimes to comply with the standards: Antigua and Barbuda, Barbados, Belize, Botswana, Costa Rica, Curaçao, France, Jordan, Macau (China), Malaysia, Panama, Saint Lucia, Saint Vincent and the Grenadines, the Seychelles, Spain, Thailand, and Uruguay.
Speaking during a January 29 OECD webinar, Achim Pross, Head of International Co-operation and Tax Administration at the OECD said that the FHTP will next assess low-tax and zero tax regimes for substance.
He said that the assessment is a logical extension of the FHTP work on substance. Otherwise, transactions could move from countries with internationally compliant tax regimes to countries with low or no-tax countries and no substance, Pross said.
.
Be the first to comment