OECD sets timeline for country profiles for cross-border tax disputes
The OECD has set the minimum standards it requires from countries submitting Mutual Agreement Procedure (MAP) profiles, with only 41 countries currently having a completed profile, which will be used as a tool for resolving cross-border tax disputes
The MAP falls under Action 14 on the Base Erosion and Profit Shifting (BEPS) Action Plan, which covers dispute resolution for cross-border double taxation disputes.
Action 14 contains a commitment by countries to have a minimum standard set to ensure they resolve disputes quickly and efficiently. This commitment to a minimum standard includes publishing MAP profiles according to a specific template.
As it stands, 43 of the G20/OECD countries have submitted their MAP profiles however, Georgia, Russia and Costa Rica’s profiles remain incomplete.
Colombia, India and Saudi Arabia have not yet submitted any part of their MAP profiles.
The MAP profile should include competent authority details, links to domestic MAP guidelines and other useful jurisdiction-specific information regarding the MAP process.
The UK’s MAP profile is 15 pages long and includes information on preventing disputes, access to MAP, resolution of MAP cases and implementation of MAP agreements.
MAP is used ‘where doubts or difficulties arise in relation to the interpretation or application of the tax treaty, or where taxpayers enter into disputes with tax authorities on the tax treaty treatment of their activities’.
Action 14 aims to minimise the risks of uncertainty and unintended double taxation. This is through ensuring tax treaties are implemented consistently and includes resolving disputes that may arise in an efficient manner, which countries have also agreed to conform to.
BEPS Action 14 on More Effective Dispute Resolution Mechanisms peer review documents are available here.
OECD’s MAP Profiles are available here.