Tax

Making Dispute Resolution Mechanisms More Effective, Action 14 - 2015 Final Report

In series:OECD/G20 Base Erosion and Profit Shifting Projectview more titles

Published on October 05, 2015

Also available in: Spanish, French, Korean

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Improving dispute resolution mechanisms is an integral component of the work on BEPS. The measures developed under Action 14 of the BEPS Project and contained in this report aim to minimize the risks of uncertainty and unintended double taxation. They do so by ensuring the consistent and proper implementation of tax treaties, including the effective and timely resolution of disputes regarding their interpretation or application through the mutual agreement procedure. Countries have agreed to important changes in their approach to dispute resolution, such as a minimum standard with respect to the resolution of treaty-related disputes. They have committed to its rapid implementation and agreed to ensure its effective implementation through the establishment of a robust peer-based monitoring mechanism.  A large group of countries has also committed to provide for mandatory binding arbitration in their bilateral tax treaties as a mechanism to guarantee that treaty-related disputes will be resolved within a specified timeframe.

BEPS PACKAGE 2015

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Base Erosion and Profit Shifting (BEPS) refers to tax planning strategies that exploit gaps and mismatches in tax rules to artificially shift profits to low or no-tax locations where there is little or no economic activity, resulting in little or no overall corporate tax being paid.