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OECD tax leader details next steps beyond BEPS

Pascal Saint-Amans of the Centre for Tax Policy and Administration describes the push for transparency, certainty and growth.

Pascal Saint-Amans, Director of the Centre for Tax Policy and Administration at the Organisation for Economic Co-operation and Development (OECD), joined us via video at our aHead of Tax client event in Barcelona, Spain, on 14–16 June 2016. He detailed the OECD’s tax work in the wake of the Base Erosion and Profit Shifting (BEPS) project. The following is a transcript of his remarks:

I’m happy to share with you some insights on the tax work that we are doing at the OECD.

I think there is some BEPS fatigue among all of us, starting with me, but the BEPS project is still very high on our agenda.


There is more to come on the international tax agenda.

You, of course, saw the news that the transparency agenda has been refocused after the release of the Panama Papers and the other leaks related to the BVI (British Virgin Islands) and other jurisdictions.

We have a lot of work to do in this area to improve access to beneficial ownership information.

We’re working with the Financial Action Task Force on this front, and there will be important steps on the way forward, particularly at the G20 finance ministers’ meetings in July and October, and at the G20 leaders’ summit in September.

Tax and growth

Beyond the transparency agenda, we are starting a new tax pillar with the G20.

The G20 will push for better tax policies across the G20 and across the world to increase growth.

The world today needs growth — jobs and employment — but we must also reconcile a pro-growth agenda with the need to reduce inequalities.

The question we’ll have to address is, how do we square that from a tax perspective?

Tax certainty

The G20 will also push for tax certainty as part of a pro-growth agenda.

The idea here is to start work over the next two years, in particular when the German G20 presidency starts on 1 December of this year, to deliver some practical outputs to improving tax certainty.

So there will be a macroeconomic survey of the impact of tax uncertainty on investment and, in turn, on growth and jobs.

Beyond that, we’ll try to promote practical instruments to improve tax certainty.

We’ll promote the value of advance pricing agreements, and push for a better way to resolve disputes through mutual agreement procedures (MAP).

We’ll also try to get as many countries as possible to commit to mandatory binding arbitration, which will be included in the multilateral instrument to implement tax-treaty-related BEPS measures that is being negotiated by more than 95 countries.

To date, I think we have 96 countries — which covers more than 2,000 bilateral treaties — participating in the development of the multilateral instrument.

We expect to open it for signature by the end of this year and hope to have countries begin signing it during the German G20 Presidency in the first half of 2017.

The multilateral instrument will include an optional provision on mandatory binding arbitration, and the challenge here will be to get as many countries and jurisdictions as possible to “opt in” to the arbitration provision.

Tax administration

The OECD Forum on Tax Administration (FTA) will continue to promote the value of cooperative compliance between revenue bodies and large business taxpayers.

I think the FTA MAP Forum’s work on reviewing the minimum standard on MAP under BEPS Action 14 will be a game changer.

Action 14 is focused on ensuring that treaty-related disputes can be effectively and efficiently resolved under MAP so that taxpayers have more legal certainty.

The MAP Forum will be starting the peer review process very soon after the 30 June–1 July meeting in Kyoto on the new inclusive framework for BEPS implementation.

We expect to see maybe 90, 100 countries join the framework.

What’s next?

So you can see that we have a big agenda ahead of us.

There is also the work that the OECD is doing with the IMF, the World Bank and the UN to establish a Platform for Collaboration on Tax, which will enable us to join forces in terms of delivering technical assistance to a large number of developing countries on strengthening their tax capacity-building efforts and designing better tax policies.

We at the OECD have a lot to do, which may explain why I was not fortunate enough to be able to be with you today.

But it’s quite an exciting time, as we now move to rebalance the global approach to tax policy.

We had BEPS to fight tax avoidance, and we have transparency to tackle tax evasion — we now need to have tax certainty to rebalance all of that.

Taxpayers must pay their due to tax administrations.

But tax administrations must in return trust taxpayers that have demonstrated they can be trusted and also provide more certainty and better tax policies.

The OECD is there to promote these policies, which I hope will be helpful to tax administrations, governments and taxpayers alike.

So I wish you a very fruitful meeting today and regret that I could not be with you.

Thank you.

This article is included in issue 18 of EY´s Global tax policy and controversy briefing.

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