06/11/2015 – In-depth discussions took place this week as the international community continues to make progress on the international tax agenda. Officials from more than 100 countries drawing from tax authorities, ministries of finance, development agencies, as well as regional and international organisations, business and civil society came together in a series of meetings hosted by the OECD. The role of tax in State building and domestic resource mobilisation, enhanced cross-border co-operation and the development of global solutions to international tax challenges were important topics debated amongst participants as they worked together to shape the solutions.
TASK FORCE ON TAX AND DEVELOPMENT
The OECD’s Task Force on Tax and Development met on 2-3 November 2015 to review progress on tax and development made in 2015, including in relation to the UN Sustainable Development Goals (SDG’s), the Financing for Development Conference, the Addis Tax Initiative, and the OECD/G20 Base Erosion and Profit Shifting Project (BEPS). The meeting welcomed the completion of the G20 Development Working Group report on Options for Low Incomes Countries’ Effective and Efficient Use of Tax Incentives for Investment. Over 200 participants from governments, international and regional organisations, civil society and business took stock of how the Task Force is helping developing countries to raise revenues efficiently and fairly in support of the Sustainable Development Goals.
The seminar on State building, Citizenship and Taxation explored and discussed the current thinking on the role taxation plays in building effective states through enhanced accountability. It provided concrete country examples on how to address the practicalities of building the social-fiscal contract in developing countries and connecting taxpayers’ expectations with the delivery of public services.
The meeting concluded with the official launch of the Source Book on Taxpayer Education, which focuses on country-specific case studies of governments reaching out to inform and engage today’s – and future – taxpayers. Fostering an overall “culture of compliance” based on rights and responsibilities is fundamental, in which citizens see paying taxes, as an integral aspect of their relationship with the government.
Co-Chaired by South Africa and the Netherlands, the Task Force is a multi-stakeholder advisory group set up to help to improve the enabling environment for developing countries to collect taxes fairly and effectively. More information is available in the Statement of Outcomes and on the Tax and Development website.
ADVISORY GROUP FOR CO-OPERATION WITH PARTNER ECONOMIES
A meeting of the Advisory Group for Co-operation with Partner Economies consisting of key stakeholders in the Global Relations tax programme, was held on 3 November to discuss the impact, opportunities, challenges and future directions of the programme. It was attended by 15 OECD and Partner economies and 3 regional tax organisations.
In the sidelines of the Task Force and Advisory Group meetings, the African Tax Administration Forum and OECD signed a Memorandum of Understanding (MoU) renewing their co-operation on taxation for three years. The MoU recognises the achievements of this co-operation so far and the role of this partnership in ensuring that Africa's voice be heard in the global tax debate. As a concrete recognition of this close collaboration OECD will second a technical expert to the African Tax Administration Forum for two years starting in January 2016.
CREDAF WORKING GROUP ON BEPS
The CREDAF Working Group on BEPS also held its second meeting this week in Paris following the event organised in Kinshasa in May 2015. Twenty five participants, mostly from African countries, gathered to discuss the next steps of the BEPS implementation phase.
February 2016 will mark the next stage of co-operation between the CREDAF and the OECD, in Senegal with the organisation of a number of events including a seminar on transfer pricing, a meeting of the Global Forum on Transparency and Exchange of Information for Tax Purposes, as well as the regional consultation for Africa. For more information, please visit www.oecd.org/tax/developing-countries-and-beps.htm.
GLOBAL FORUM ON TAX TREATIES
On 3-4 November, the 20th Annual Global Forum on Tax Treaties brought together more than 260 senior tax officials from 102 jurisdictions and international organisations to discuss the tax treaty-related outcomes of the OECD/G20 BEPS Project.
The tax treaty-related measures agreed upon in the BEPS Project offer solutions to BEPS concerns caused by the abuse of tax treaties and the artificial avoidance of permanent establishments. Participants welcomed these measures that will help tax administrations to effectively address double non-taxation. At the same time, the discussions at the meeting confirmed that double taxation should be prevented and legal certainty should be improved. The BEPS minimum standard to make dispute resolution mechanisms more effective was discussed in this context.
The need to ensure that BEPS concerns should be addressed with global solutions was emphasised. A global community that co-operates to implement the BEPS package in a timely and consistent matter is vital, and discussions were held on the design of an inclusive framework for the BEPS implementation phase.
INAUGURAL MEETING ON THE BEPS MULTILATERAL INSTRUMENT
The Global Forum on Tax Treaties was the prelude to the Inaugural Meeting of the Ad hoc Group for the development of a Multilateral Instrument held on 5-6 November. Over 100 countries, non-state jurisdictions and international organisations are working together on the development of a multilateral instrument capable of incorporating the tax treaty-related BEPS measures into the existing network of bilateral treaties. This week’s inaugural meeting follows the procedural meeting held in May, that saw Mr. Mike Williams from the UK appointed as Chair, supported by Vice-Chairs Mr. Liao Tizhong from China, Mr. Mohammed Amine Baina from Morocco and Mrs. Kim S. Jacinto-Henares from the Philippines.
The ad hoc Group comprises 94 members from OECD and G20 countries, developing countries and non-OECD/non-G20 economies, all participating in the work on an equal footing. At its inaugural meeting, the ad hoc group decided on issues relating to the organisation of the work on the Multilateral Instrument, as well as approaches for addressing key substantive issues such as the relationship between the Multilateral Instrument and the existing bilateral treaty network. This will enable the Group to swiftly develop the Multilateral Instrument and open it for signature in 2016. The Group also established a sub-group of interested countries and jurisdictions for the development of the optional provision on mandatory binding MAP arbitration.
Countries which are interested in joining the MLI Group are invited to contact the OECD Secretariat ([email protected]) with the contact details of their designated qualified experts. For more information about the MLI Group, download the overview.
Media queries should be directed to Pascal Saint-Amans (+33 1 45 24 91 08), Director of the OECD Centre for Tax Policy and Administration (CTPA), Grace Perez-Navarro (+33 1 45 24 18 80), Deputy Director of CTPA, or the CTPA Communications Office.