G20 Finance Ministers and Central Bank Governors Meeting: International Tax Challenges


Remarks by Angel Gurría

OECD Secretary-General

Buenos Aires, Argentina - 20 March 2018

(As prepared for delivery)



Ministers, Central Bank Governors, Dear Ministers,


Last March you asked the OECD to deliver, by 2020, a report on the tax challenges related to the growing digitalisation of the world economy.

The Interim Report before you is the result of the consensus reached by, so far, the 113 members of the G20/OECD Inclusive Framework on BEPS. I will report back to you in 2019.

This has not been easy. There are disagreements between members on the main features of the digitalisation of the economy and thus, on how to tax it.

One could say that digitalisation is the ultimate tax base erosion threat and there is convergence in the need to revisit fundamental concepts, like nexus and profit allocation.


Digitalisation has changed the way companies do business, how value is created, and how to account for the increasingly important role of intangible assets and intellectual property. In the face of these changes, you realised that the international tax system may no longer be fit for purpose, that the game has changed and that it is now time to question and, perhaps, adjust the international tax rules going forward.


On the adoption of possible short term measures to tax the digital economy, there are clear disagreements and risks for the coherence of the global tax system. But you have agreed to work together to analyse the issues further, explore potential changes, and to consider the impacts of digitalisation in relation to the principles of aligning profits with underlying economic activities and with value creation. Our Interim Report doesn’t encourage short term measures, but acknowledges the expressed intention of some countries to go ahead with such measures.


You have acknowledged that it is better to have a global, consensus-based long-term approach, than unilateral, uncoordinated measures. We thus need to speed up the work and to come up with a consensus on a common approach by 2020.


We know that coordination, cooperation and a multilateral approach works.

Under the BEPS package, a number of important new standards were delivered aimed at eliminating double non-taxation. Their implementation is already having an impact. Some multinationals have changed their tax arrangements to better align them with their business operations; governments have seen their revenues increase. Over 3 billion euros in the European Union alone, as a result of the implementation of the new International VAT/GST Guidelines.


Through the work on BEPS and on tax transparency and the automatic exchange of tax information, you have successfully established a collective blueprint for policy-making in this globalised world, which reconciles tax sovereignty with multilateralism.


Automatic exchange of information is currently being implemented by over 100 jurisdictions, thus achieving an unprecedented level of transparency. Following the progress achieved so far, we now need to revise the criteria to identify non-cooperative jurisdictions. More than 85 billion euros (more than 100 billion dollars) have already been collected by countries through “voluntary disclosure mechanisms”, by taxpayers who know their names will appear on the tax officer’s desk. “Nowhere to hide”.


The OECD is working on an update of such criteria, which will be presented at your meeting next July. You are also working hard to implement the measures agreed within the BEPS Project, and some are going beyond the minimum requirements, as we have seen with the recent US tax reform.


For the coming years, the key challenge is to build on this new multilateral framework that you have created.


We will need to leverage its full potential by maintaining the dynamic that has been the driver of past achievements. It is more important than ever that G20 countries work together.


The OECD will continue to help you find these collective approaches to taxing an increasingly digitalised world economy. Thank you.



See also:

OECD work on Tax

OECD work with G20

OECD Secretary-General Tax Report to G20 Finance Ministers


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