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OECD release public comments on tax certainty for issues related to Amount A under Pillar One
A central element of Amount A is the innovative Tax Certainty Framework for Amount A, which guarantees certainty for in-scope groups over all aspects of the new rules, including the elimination of double taxation.
This eliminates the risk of uncoordinated compliance activity in potentially every jurisdiction where a group has revenues, as well as a complex and time-consuming processes to eliminate the resulting double taxation. The Tax Certainty Framework incorporates a number of elements designed to address different potential risks posed by the new rules.
A Scope Certainty Review, which provides an out-of-scope group with certainty that it is not in-scope of rules for Amount A for a period, helps to remove the risk of unilateral compliance actions. An Advance Certainty Review, provides certainty over a group’s methodology for applying specific aspects of the new rules that are specific to Amount A and will apply for a number of future periods.
Furthermore, a tax certainty process for issues related to Amount A will ensure that in-scope groups will benefit from dispute prevention and resolution mechanisms, which will help avoid double taxation due to issues related to Amount A (e.g. transfer pricing and business profits disputes), in a mandatory and binding manner. An elective binding dispute resolution mechanism will be available only for issues related to Amount A for developing economies, that are eligible for deferral of their BEPS Action 14 peer review and have no or low levels of Mutual Agreement Procedure (MAP) disputes.
For more information, please contact:
Maulik Doshi
Managing Director – Global Transfer Pricing and International Tax
Nexdigm, India
E: maulik.doshi@nexdigm.com
W: www.nexdigm.com
