OECD Publishes Comments On CbC Reporting Review
Ulrika Lomas, Tax-News.com, Brussels
17 March, 2020
The OECD's public consultation on a review into the new transfer pricing documentation rules proposed as part of BEPS Action 13 has closed. It has published the 79 responses received.
Action 13 of the OECD/G20 Base Erosion and Profit Shifting (BEPS) Project (BEPS Action 13) established a three-tiered standardized approach to transfer pricing documentation, including a Country-by-Country Report (CbC report) that provides details of an MNE group's revenues, profit before tax, tax accrued, and other information relevant to a high level risk assessment, for each tax jurisdiction in which the MNE group has a constituent entity.
Country-by-Country reporting (CbC reporting) is one of four BEPS minimum standards that all members of the BEPS Inclusive Framework are committed to implementing.
The BEPS Action 13 report also included a requirement that a review of the CbC reporting minimum standard be completed by the end of 2020 (the 2020 review).
On February 6, 2020, the Inclusive Framework released on the OECD website a public consultation document (also available in French) on matters where its members seek input from stakeholders in conducting this 2020 review.
The public consultation document comprises three chapters: Chapter 1 contains general topics concerning the implementation and operation of BEPS Action 13; Chapter 2 contains topics concerning the scope of CbC reporting; and Chapter 3 contains topics concerning the content of a CbC report. Specific questions upon which comments were sought were set out in each chapter.
The responses received are from a broad range of stakeholders, including large multinationals, tax professionals, business representative groups, civil society organizations, investment funds, and, unusually, a group of 33 US lawmakers, who, alongside a number of civil society organizations, are calling for the reports to be made publicly accessible.
The tax industry and business representative organizations generally urged the OECD to not make significant changes to the requirements that would increase the compliance burden on multinational taxpayers. Some tax industry representatives saw merit in changing the threshold for the requirement to file a CbC report to a multi-year method that would benefit those multinational groups hovering around the EUR750m or equivalent local amount threshold.