OECD invites public input on the possible solutions to the tax challenges of digitalisation

Extension of the comment period for the public consultation document on the possible solutions to the tax challenges of digitalisation

Update 19/02/2019

In order to ensure all stakeholders are given the full opportunity to provide feedback on the publication consultation document relating to the possible solutions to the tax challenges of digitalisation, the OECD has extended the comment period to 6 March 2019. The public consultation meeting remains scheduled for 13-14 March 2019 and the deadline for registration to attend the public consultation remains 1 March 2019.

13/02/2019 – As part of the ongoing work of the Inclusive Framework on BEPS, the OECD is seeking public comments on key issues identified in a public consultation document on possible solutions to the tax challenges arising from the digitalisation of the economy. The publication of the consultation document was foreshadowed with the release of a Policy Note by the Inclusive Framework on 29 January 2019 and follows the agreement of members of the Inclusive Framework to examine proposals involving two pillars; one pillar that focusses on the allocation of taxing rights and a second pillar that addresses remaining BEPS issues. The work will be carried out as the Inclusive Framework continues to work towards a consensus-based long-term solution in 2020.

Following a mandate by G20 Finance Ministers in March 2017, the Inclusive Framework on BEPS, working through its Task Force on the Digital Economy (TFDE), delivered an Interim Report in March 2018, Tax Challenges Arising from Digitalisation – Interim Report 2018. One of the important conclusions of this report is that members agreed to review the impact of digitalisation on nexus and profit allocation rules and committed to continue working together towards a final report in 2020 aimed at providing a consensus-based long-term solution, with an update in 2019.

Since the delivery of the Interim Report, the Inclusive Framework further intensified its work and several proposals emerged that could form part of a long-term solution to the broader challenges arising from the digitalisation of the economy and the remaining BEPS issues. The work on these proposals is being conducted on a “without prejudice” basis; their examination does not represent a commitment of any member of the Inclusive Framework beyond exploring these proposals. In this context, the Inclusive Framework agreed to hold a public consultation on possible solutions to the tax challenges arising from the digitalisation of the economy on 13 and 14 March 2019 at the OECD Conference Centre in Paris, France. The objective of the public consultation is to provide external stakeholders an opportunity to provide input early in the process and to benefit from that input.

As part of this public consultation, this consultation document describes the proposals discussed by the Inclusive Framework at a high level and seeks comments from the public on a number of policy issues and technical aspects. The comments provided will assist members of the Inclusive Framework in the development of a solution for its final report to the G20 in 2020.

Interested parties are invited to send their comments on this consultation document. Comments should be sent by no later than Wednesday, 6 March 2019 to [email protected] in Word format (in order to facilitate their distribution to government officials). All comments submitted should be addressed to the Tax Policy and Statistics Division, Centre for Tax Policy and Administration.

Please note that all comments on this consultation document will be made publicly available. Comments submitted in the name of a collective “grouping” or “coalition”, or by any person submitting comments on behalf of another person or group of persons, should identify all enterprises or individuals who are members of that collective group, or the person(s) on whose behalf the commentator(s) are acting. Speakers and other participants at the upcoming public consultation in Paris will be selected from among those providing timely written comments on this consultation document.

The proposals included in this consultation document do not represent the consensus views of the Inclusive Framework, the Committee on Fiscal Affairs (CFA) or their subsidiary bodies. Instead, they intend to provide stakeholders with substantive proposals for analysis and comment.

Public Consultation

A public consultation meeting will be held at the OECD Conference Centre in Paris on Wednesday, 13 March and Thursday morning, 14 March 2019. Further information about attending the public consultation is available online. Those wishing to attend are invited to register by no later than Friday, 1 March 2019.

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) or Grace Perez-Navarro (+33 1 45 24 18 80), Deputy-Director of the CTPA.