BEPS is of major significance for developing countries due to their heavy reliance on corporate income tax, particularly from multinational enterprises (MNEs). Engagement with developing countries has thus been extensive since the beginning of the Project to strengthen their involvement and bring them to the heart of the technical work. In the first year of the project, over 80 developing countries and other non-OECD/non-G20 economies have been consulted through four in-depth regional consultations and five thematic global fora. In November 2014, the OECD launched a new strategy for deepening developing countries’ engagement in the BEPS Project that is based on three pillars:
KSA supported knowledge sharing activities of the BEPS and Developing Countries project for 2015, and helped ensured effective participation of low and middle income countries in regional policy network meetings including the Regional Network Meetings on the BEPS Project in Asia-Pacific (12-13 February in Seoul, Korea) Latin America and the Caribbean (26-27 February in Lima, Peru) organised in partnership with the Inter-American Centre of Tax Administrations (CIAT). The KSA’s support has also facilitated knowledge sharing among OECD and developing countries at the OECD Global Forum on Transfer Pricing on 16-18 March 2015, as well as the participation of low-income country participants to BEPS meetings for the Task Force on Tax and Development and for the Task Force on the Digital Economy.
The Project received positive feedbacks from its partner countries about their enhanced engagement on BEPS. The evidence is clear: the negotiations to implement the treaty-based measures via a multilateral instrument (to be finalised in 2016) are being undertaken in 95 jurisdictions, many of which are developing economies, on an equal footing. Toolkits are being prepared to ensure that low-income countries can implement and apply the BEPS measures in a swift manner and that other issues which are key to developing countries (e.g. wasteful tax incentives and lack of comparables) are addressed, even if not included in the scope of the BEPS Project. Finally, at the request of the G20, an inclusive framework, where all interested jurisdictions participate on an equal footing, is being designed; a proposal in this respect will be submitted to the G20 in early 2016. The Project has clearly demonstrated the importance and the benefit of involving developing countries in the process, as well as their need for both technical and in some case financial support.
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