(March 31, 2015) 

On March 31, 2015 the OECD released a Public Discussion Draft on Action 12 of the BEPS Action Plan (Require taxpayers to disclose their aggressive tax planning arrangements). The Discussion Draft is titled: “Public Discussion Draft - BEPS ACTION 12: MANDATORY DISCLOSURE RULES”.

 

In this respect the BEPS Action Plan states: 

Transparency on certain tax planning/transactions is also needed. Comprehensive and relevant information on tax planning strategies is often unavailable to tax administrations. Yet the availability of timely, targeted and comprehensive information is essential to enable governments to quickly identify risk areas. While audits remain a key source of relevant information, they suffer from a number of constraints as tools for the early detection of aggressive tax planning techniques. Measures designed to improve information flow about tax risks to tax administrations and tax policy makers (“disclosure initiatives”) may be useful in this regard. Other potentially useful measures include co-operative compliance programmes between taxpayers and tax administrations (see OECD, 2013b).

 

ACTION 12

Require taxpayers to disclose their aggressive tax planning arrangements

Develop recommendations regarding the design of mandatory disclosure rules for aggressive or abusive transactions, arrangements, or structures, taking into consideration the administrative costs for tax administrations and businesses and drawing on experiences of the increasing number of countries that have such rules. The work will use a modular design allowing for maximum consistency but allowing for country specific needs and risks. One focus will be international tax schemes, where the work will explore using a wide definition of “tax benefit” in order to capture such transactions. The work will be co-ordinated with the work on co-operative compliance. It wil also involve designing and putting in place enhanced models of information sharing for international tax schemes between tax administrations.

 

The discussion draft provides an overview of mandatory disclosure regimes, based on the experiences of countries that have such regimes, and sets out recommendations for a modular design of a mandatory disclosure regime including recommendations on rules designed to capture international tax schemes.

 

The Discussion Draft sets out a standard framework for a mandatory disclosure regime that ensures consistency while providing sufficient flexibility to deal with country specific risks and to allow tax administrations to control the quantity and type of disclosure. The  Discussion Draft is divided into the following four chapters:

·       Chapter I is the introduction of this document;

·       Chapter II provides an overview of the key features of a mandatory disclosure regime and considers its interaction with other disclosure initiatives and compliance tools;

·       Chapter III sets out both the framework and features for the modular design of a mandatory disclosure regime;

·       Chapter IV looks at international transactions and considers how these could best be captured by a mandatory disclosure regime.

 

Comments should be submitted by email by April 30, 2015 at the latest.

 

The OECD also announced that a public consultation meeting on Action 12 will be held in Paris at the OECD Conference Centre on May 11, 2015.

Click here to be forwarded to the Discussion Draft on Action 12 as published on the website of the OECD, which will open in a new window.

For further information click here to be forwarded to a press release as issued by the OECD in this repect.

Click here to be forwarded to the webpage of the OECD where one can register for the public consultation meeting regarding BEPS Action 12 to be held on May 11, 2015.

 

Copyright – internationaltaxplaza.info 

 

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