OECD releases cross-border VAT implementation guidance

The OECD today released guidance designed to assist policy makers in their effort to evaluate and develop the legal and administrative framework for collecting VAT on cross-border sales.

The guidance, Mechanisms for the Effective Collection of VAT/GST Where the Supplier Is Not Located in the Jurisdiction of Taxation, focuses on the implementation of internationally agreed standards in the 2015 OECD/G20 base erosion profit shifting (BEPS) plan final report on Action 1 “Addressing the Tax Challenges of the Digital Economy.”

An aim of the guidance is to aid the development of consistent tax rules worldwide regarding the collection of VAT.

The guidance addresses key policy questions and design issues concerning the collection of VAT/GST on supplies of services and intangibles in cases where the supplier is not located in the jurisdiction of taxation.

It also examines and provides guidance to aid the implementation of registration-based collection regimes and simplified registration and compliance regimes for nonresident suppliers, as outlined the OECD BEPS report.




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