Archive for BEPS

Evolution Of OECD’s Two Pillar Approach To Address Tax Challenges Of The Digitalization Of The Economy

ROBERT BACHMANN

In February 2019 the OECD released a public consultation document draft titled “Addressing the Tax Challenges of the Digitalisation of the Economy”. The draft notes that back in 2015 the 2015 BEPS Action 1 Report on Addressing the Tax Challenges of the Digital Economy initially cited the challenges for international taxation which stemmed from the digital economy and that much of this consultation draft was to address these issues. It is in the February 2019 document in which the two pillar approach for addressing the digital economy was first introduced.
Pillar One focuses on the allocation of taxing rights and considers profit allocation and nexus rules. At this time three proposals for Pillar One were discussed:

1. User participation proposal: The proposal would modify current profit allocation rules to allocate profit based on where businesses’ active and participatory user bases are located, irrespective of whether those businesses have a local physical presence. The proposal notes that user participation is highly relevant for social media platforms, search engines and online marketplaces.

2. Marketing Intangible Proposal: This proposal would segment profit based on marketing intangibles in market jurisdictions. Marketing intangibles are defined as intangibles that aid in the commercial exploitation of a product or service and/or have an important promotional value for the product concerned. Some marketing intangibles it lists are brand, trade name, customer data, customer relationships and customer lists.
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Written by | Posted in BEPS • OECD • Two Pillar Approach

Everything You Need to Know About Bankruptcy

Robert McKenzie, Tax Attorney

Types of Bankruptcies
Chapter 7. In a Chapter 7 bankruptcy, all of the debtor’s nonexempt property is liquidated and the proceeds distributed to creditors. Individual debtors receive a discharge of personal liability for pre-petition debts, subject to exceptions in §523, whether or not a proof of claim was filed or the debt was allowed under §502.727(b). Read More

Written by | Posted in Banking • Bankruptcy • BEPS

Multilateral Convention to Implement Tax Treaty Related Measures to Prevent BEPS

On June 7, 2017, over 70 Ministers and other high-level representatives participated in the signing ceremony of the Multilateral Convention to Implement Tax Treaty Related Measures to Prevent Base Erosion and Profit Shifting (“Multilateral Instrument” or “MLI”).

Signatories include jurisdictions from all continents and all levels of development. A number of jurisdictions have also expressed their intention to sign the MLI as soon as possible and other jurisdictions are also actively working towards signature.

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Written by | Posted in BEPS • Tax Treaty

Several New Jurisdictions Sign Transfer Pricing, Automatic Sharing Of Corporate Country-By-Country Reports

William Byrnes

As part of continuing efforts to boost transparency by multinational enterprises (MNEs), Brazil, Guernsey, Jersey, the Isle of Man and Latvia signed today the Multilateral Competent Authority Agreement (MCAA) for the automatic exchange of Country-by-Country reports, bringing the total number of signatories to 49. This marks a further milestone towards the implementation of the OECD/G20 BEPS Project and a significant increase in cross-border cooperation on tax matters.

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Written by | Posted in BEPS • International • Offshore • Transfer Pricing

Commentary on the The Panama Papers & The Disclosure of 14,000 Clients’ 214,000 Offshore Companies Files and Assets

A leak of searchable 11.5 million files, that’s 2.6 terabytes of data, from the embattled offshore services provider Mossack Fonseca. Every email, client note, asset and income statement, instruction, communication, .. since 1977!  2.6 terabytes of data, 11.5 million files, is a lot of files and scanned documents to comb through, so this leak is potentially, and probably, more significant than the 2014 ICIJ reported on leak or even the HSBC and UBS’ leaks. Read More

Written by | Posted in BEPS • FATCA • OVDP

Closing The Gap on BEPS: Current Efforts To Update Tax Codes In The Era Of Transfer Pricing

Transfer pricing is a complex issue currently affecting multinational enterprises (MNEs) and tax authorities of both developed and developing nations. The OECD, EU, UN, IRS and others are all preparing adjustments of tax schemes to improve clarity, ease dispute resolution, and provide for analysis and penalties for transfer mispricing. In increasing the number of both transfer pricing audits and adjustments in recent years, Read More

Written by | Posted in BEPS • Transfer Pricing

Cloud Computing and Other High Tech Tax Issues

Cutting edge activities challenge tax rules written with different business methods and products in mind. For example, cloud computing raises issues as to how longstanding tax provisions, such as the research tax credit and Section 199 manufacturing deduction apply. This and other current tax topics relevant to high tech companies and their tax advisers are on the agenda for the 31st Annual TEI-SJSU High Tech Tax Institute, November 9 & 10, 2015 in Palo Alto. Additional topics include BEPS Relevance, M&A activities, state tax haven activities, European Union hot topics and how these topics also affect the income tax provision on financial statements.

For the complete agenda and list of speakers, as well as to register, please visit Read More

Written by | Posted in BEPS

BEPS – The View From Around the World

We hear a lot about the OECD’s BEPS project (base erosion and profit shifting) and its action items. What is the relevance of “country-by-country” reporting for transfer pricing documentation? Does the statement on harmful tax practices mean that the US should adopt a patent box? The 31st Annual TEI-SJSU High Tech Tax Institute, scheduled for November 9 and 10, 2015 in Palo Alto, will address these questions and more. A BEPS panel will include attorneys from China, Ireland and the U.S. to share how other countries are responding the BEPS project and what it means for your company or clients.  Another panel with practitioners from the UK and Ireland will explore hot topics in the EU. Heather Maloy, (former) Commissioner for the IRS Large Business & International Division will also be speaking, along with numerous other experts on hot tax topics for high tech Read More

Written by | Posted in BEPS • Transfer Pricing