22/09/2017 – As part of the ongoing work of the Task Force on the Digital Economy (TFDE), the OECD is seeking public comments on key issues identified in a request for input related to the tax challenges raised by digitalisation and the potential options to address these challenges.
The Action 1 report, Addressing the Tax Challenges of the Digital Economy was released in October 2015 as part of the OECD/G20 Base Erosion and Profit Shifting (BEPS) package. This report, which had been developed by the TFDE, was subsequently endorsed by the G20 Leaders in November 2015 and by the more than 100 countries and jurisdictions participating in the Inclusive Framework on BEPS.
The report recognised that digitalisation and some of the resulting business models present some challenges for international taxation. However, the report also acknowledged that it would be difficult, if not impossible, to ‘ring-fence’ the digital economy from the rest of the economy for tax purposes because of the increasingly pervasive nature of digitalisation. While digitalisation and the resulting business models do not generate unique BEPS issues, some of the key features of digitalisation exacerbate BEPS risks.
In July 2017, at their summit in Hamburg, the G20 Leaders reiterated their support for the OECD’s work on taxation and digitalisation, which followed the request made by the G20 Finance Ministers at Baden-Baden in March 2017, that the TFDE deliver an interim report on the implications for taxation of digitalisation to the G20 Finance Ministers in April 2018.
The request for input outlines the background on the work regarding the tax challenges of digitalisation from the BEPS Action 1 report and invites comments on the impact of digitalisation on business models and value creation, challenges and opportunities for tax systems, the implementation of the measures outlined in the BEPS package and potential options to address the direct tax challenges of digitalisation.
Comments should be sent by no later than 13 October 2017 to TFDE@oecd.org in Word format. Please note that all comments received 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 entreprises or individuals who are members of that collective group, or the person(s) on whose behalf the commentator(s) are acting.
A public consultation meeting on the tax challenges of digitalisation will be held at the University of California, Berkeley on 1 November 2017 commencing at 9:30am. Further information about attending the public consultation is available online, please register by 6 October 2017.
Media queries should be directed to Pascal Saint-Amans, Director of the OECD Centre for Tax Policy and Administration (+33 6 26 30 49 23) or David Bradbury, Head of the Tax Policy and Statistics Division (+33 1 45 24 15 97).