The OECD announced today the entry into force of the BEPS multilateral instrument — a multilateral tax treaty used by countries to swiftly add provisions to their existing bilateral tax treaties that were agreed to in the OECD/G20 base erosion profit shifting (BEPS) project. The BEPS tax treaty provisions are designed to curtail tax avoidance by multinationals and improve the resolution of cross-border tax disputes.
With the deposit of the fifth instrument of ratification by Slovenia on March 22, the treaty, formally known as the Multilateral Convention to Implement Tax Treaty Related Measures to Prevent Base Erosion and Profit Shifting, will become operational on July 1, the OECD said.
“The entry into force of this multilateral convention marks a turning point in the implementation of OECD/G20 efforts to adapt international tax rules to the 21st Century,” said OECD Secretary-General Angel Gurría in a statement.
“We are translating commitments into concrete legal provisions in more than 1,200 tax treaties worldwide. Thanks to this drive by the international community, we are ensuring that multinational companies pay their fair share when it comes to fulfilling tax obligations, like citizens do,” Gurría said.
The four other countries previously ratifying the agreement are Austria, the Isle of Man, Jersey, and Poland.
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