Mongolia has joined the “Inclusive Framework on BEPS,” bringing the number of participating countries to 111, the OECD announced today.
Mongolia’s decision to join follows that of the Bahamas and Zambia, which both joined in late December.
The Inclusive Framework on BEPS is a group of countries that are working together to prevent multinational group tax avoidance and to ease the resolution of cross-border tax disputes.
By joining the group, Mongolia has pledged to adopt minimum international taxation standards developed in 2015 by OECD and G20 nations, with input by other nations, in response to the base erosion profit shifting (BEPS) plan.
The commitment means that Mongolia will adopt provisions to prevent tax treaty shopping, implement country-by-country reporting on multinationals and exchange country-by-country reports with other country tax administrations. Mongolia will also limit the benefits of any intellectual property or other tax regimes deemed to be preferential tax regimes and will fully implement the mutual agreement procedure in its tax treaties with other countries to aid resolution of tax disputes. Mongolia must also pay a fee to participate.
In return, Mongolia will be permitted to work alongside other BEPS Inclusive Framework countries to ensure widespread adoption of the BEPS minimum standards and participate in a peer review processes.
Mongolia may also participate in the framework’s international tax standard setting work.