Permanent Establishments (Article 5)
A Working Group set up to examine various issues related to the definition of permanent establishment has presented its report to the Working Party. Issues under consideration include the precise meaning of the phrase "fixed place of business"; how to interpret the rule governing building sites, including its application to supervisory or consulting services; the nature of "preparatory or auxiliary activities" and problems with agency permanent establishments.
The Implications for Tax Treaty Policy of the Communications Revolution (Articles 5, 7 and 12)
The Working Party is also actively working on the issues concerning the application of tax conventions to electronic commerce transactions. This work is being undertaken directly by the Working Party and through Technical Advisory Groups (TAGs), which include the private sector and non-member countries. Work completed includes clarification of whether a server would constitute a permanent establishment and on the clarification on the characterisation of income from Electronic Commerce.
The Treatment of Dependent Personal services (Article 15)
The use of the term "employer" is under consideration with a view to clarifying how this term should be understood in cases not already discussed in the Commentary.
Taxing Pensions (Articles 18 and 19)
A Working Group is dealing with a number of issues concerning the Article on pensions, the current teatment of cross-border payments under tax conventions, an examination of alternative provisions and clarification of the interpretation of certain terms used in Article 18.
The Treatment of Employee Stock Option Plans (Article 13 and 15)
A Working Group is considering the current treatment of employee stock option plans under tax conventions.
Assistance in the Collection of Taxes (new Article)
The Working Party is considering the inclusion of a new article cncerning assistance in the collection of taxes. The Article would provide the rules under which contracting states may agree to provide each other assistance in the collection of taxes.
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