OECD Announces Revised Timeline for BEPS

The Organization for Economic Cooperation and Development will issue three discussion drafts and hold four public consultations before the end of May as the organization ramps up its joint project with the Group of 20 on base erosion and profit shifting (BEPS), an official announced Feb. 20.

Raffaele Russo, head of the Center for Tax Policy and Administration’s BEPS project, gave a revised calendar for the items under the plan at a Tax Council Policy Institute conference. He said the OECD will publish its discussion draft on tax treaty abuse on March 17 and that stakeholders will have until April 11 to submit their comments to the OECD. The organization will hold a public consultation April 14-15 on treaty abuse.

Under a tight BEPS timetable, Russo said, the OECD also will:

—publish its discussion draft on the tax challenges of the digital economy on March 24, with comments due April 14, and hold a public consultation April 23;

—publish its discussion draft on hybrid mismatch arrangements April 4, with comments due May 4, and hold a public consultation May 15 and 16.

Country-by-Country Reporting

On May 19, the OECD will hold a consultation on its Jan. 30 “Discussion Draft on Transfer Pricing Documentation and CbC Reporting,” which would replace Chapter 5 of its transfer pricing guidelines (22 Transfer Pricing Report 1214, 2/6/14).

Stakeholders have until Feb. 23 to submit written comments on the discussion draft.

Working Party No. 6 will present a final version of the new guidance to the June meeting of the OECD’s Committee on Fiscal Affairs before the G-20 meets in September.

Also speaking at the Feb. 20 TCPI conference, H.M. Treasury Director of Business and International Tax Mike Williams suggested that businesses respond to the discussion draft by explaining to governments what information they can obtain at a reasonable cost and what information will be expensive to obtain.

William Morris, chair of the tax committee under the OECD’s Business and Industry Advisory Committee as well as director of global tax policy with GE International, said the draft reflects a view that businesses can reassemble their information as easily as they can rearrange a deck of cards.

Morris said implementing the discussion draft will require businesses to rewrite their information technology software, and the more apt analogy is diverting a river. “You have the same water, but it is the digging of the new canal that results in very substantial costs.”

The OECD’s BEPS plan will be discussed in depth at the Global Transfer Pricing Conference in Paris March 31-April 1. 

Credit: Bloomberg