Posted By Gbaf News
Posted on September 14, 2014
In an effort to engage the public in the combat against tax evasion, the OECD has invited comments on BEPS Action 11 earlier in August, in regards to the methodologies of collecting and processing data on BEPS.
BEPS (Base Erosion and Profit Shifting), reportedly “undermines the integrity of the tax system, as the public, the media and some taxpayers deem reported low corporate taxes to be unfair,” and the OECD BEPS Action Plan, denotes the fundamental changes required to effectively prevent practices that artificially segregate taxable income from the activities that generate it.
As reported by the OECD, Action 11 refers to recommendations regarding indicators of the scale and economic impact of BEPS and ensures that tools are available to monitor and evaluate the effectiveness and economic impact of the actions taken to address BEPS on an ongoing basis. This will involve developing an economic analysis of the scale and impact of BEPS (including spillover effects across countries) and actions to address it. The work will also involve assessing a range of existing data sources, identifying new types of data that should be collected, and developing methodologies based on both aggregate (e.g. FDI and balance of payments data) and micro-level data (e.g. from financial statements and tax returns), taking into consideration the need to respect taxpayer confidentiality and the administrative costs for tax administrations and businesses.
Considering the ground-breaking impact on tax planning which BEPS is expected to have, the BEPS Action Plan appears to provide assurances that the prelude to implementation will “include a transparent and inclusive consultation process” and that all stakeholders such as business, labour, non-governmental organisations, think-tanks, and academia will be consulted.