OECD consults on digital tax rule changes

The OECD has opened a public consultation on its ‘milestone’ proposals for changes to the taxation regime in response to the digitalisation of the economy, which include revisions to the arm’s length principle and a focus on taxing profits where they are derived

The proposals were outlined in a policy note published last month prepared by members of the OECD’s inclusive framework. This stated that they 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.

The OECD has highlighted that 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 the options.

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.

Note: The OECD extended the consultation period for plans to reform digitisation of tax to 6 March 2019 to ensure all stakeholders are given the full opportunity to provide feedback on the publication consultation document [updated 19 Feb 2019]

Comments on the consultation document should be sent to TFDE@oecd.org.

A public consultation meeting will be held at the OECD Conference Centre in Paris on 13 March and the morning of 14 March. Those wishing to attend are invited to register by 1 March.

Addressing the tax challenges of the digitalisation of the economy is here.

Details of the public consultation are here.

Report by Pat Sweet

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