Australian laws designed to curtail multinational tax avoidance through hybrid mismatch and branch mismatch arrangments and approving the Multilateral Convention to Implement Tax Treaty Related Measures to Prevent Base Erosion and Profit Shifting (MLI) received Royal Assent on August 24, the Australian Taxation Office (ATO) has announced.
The MLI is a multilateral tax treaty designed to allow countries to swiftly add provisions to their bilateral tax treaties. These new tax treaty provisions added through the MLI were agreed to as a result of the OECD/G20 Base Erosion and Profit Shifting (BEPS) project.
The hybrid mismatch and branch mismatch rules are also a result of the BEPS project. These rules are designed to stop multinational enterprises from entering into related party transactions that result in the MNE claiming double deductions or not including income in taxable income.
Be the first to comment