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OECD Steps On Tax Avoidance Welcome

Wednesday, September 17, 2014

GMB Welcome OECD Recommendations To G20 Meeting In Australia This Coming Weekend To Combat Tax Avoidance By Multinationals

EU Commission must get tougher on tax avoidance and evasion and work with OECD to make sure tax dodgers like Amazon, Starbucks, Google and the like have nowhere to go and pay their fair share of taxes says GMB.

GMB welcome the Organization for Economic Cooperation and Development (OECD’s) first Base Erosion and Profit Shifting Project recommendations to G20 for international approach to combat tax avoidance by multinationals which will be on the agenda when G20 finance ministers meet on Saturday and Sunday (20 /21 September) in Cairns, Australia. See notes to editors for copy of OECD press release.

Kathleen Walker Shaw, GMB European Officer who holds a substitute seat for European Public Service Union Federation on the EU Tax evasion platform, said “GMB welcome the OECD recommendations to the G20 meeting this coming weekend for measures to combat tax avoidance by multinationals.

Effective action in this area is long overdue. All the while the lax rules allow corporations to shift and squirrel away their profits with impunity to avoid paying their fair share to public finances. Meanwhile the rest of us are being bled dry, and our vital public and health services hacked to bits.  Now it is one rule for some of us and no rules for the corporations. This is driving deepening inequality in society. There is an urgent need for the activities or the multinationals and others in each tax jurisdiction to be totally transparent and for them to cough up their fair share of tax.

GMB is pushing the European Commission to get tougher on tax avoidance and evasion and they need to work with OECD to make sure tax dodgers like Amazon, Starbucks, Google and the like have nowhere to go.”

End

Contact:  Kathleen Walker Shaw 07841 181 549/ 00 32 2 2305675 or Bert Schouwenburg 07974 251 764 or GMB press office 07921 289880  

Notes to editors

Copy of OECD press release

OECD releases first Base Erosion and Profit Shifting Project recommendations to G20 for international approach to combat tax avoidance by multinationals

16/09/2014 - The OECD released today its first recommendations for a co-ordinated international approach to combat tax avoidance by multinational enterprises, under the OECD/G20 Base Erosion and Profit Shifting Project designed to create a single set of international tax rules to end the erosion of tax bases and the artificial shifting of profits to jurisdictions to avoid paying tax.

Presenting the OECD’s recommendations, Secretary-General Angel Gurría said: “The G20 has identified base erosion and profit shifting as a serious risk to tax revenues, sovereignty and fair tax systems worldwide. Our recommendations constitute the building blocks for an internationally agreed and co-ordinated response to corporate tax planning strategies that exploit the gaps and loopholes of the current system to artificially shift profits to locations where they are subject to more favourable tax treatment.” (Read the full speech)

At the request of the G20 Leaders, the OECD’s work is based on a BEPS Action Plan setting out the 15 key elements to be addressed by 2015. The project aims to help governments protect their tax bases and offer increased certainty and predictability to taxpayers, while guarding against new domestic rules that result in double taxation, unwarranted compliance burdens or restrictions to legitimate cross-border activity.       

The first 7 elements of the Action Plan released today focus on helping countries to:

ensure the coherence of corporate income taxation at the international level, through new model tax and treaty provisions to neutralise hybrid mismatch arrangements (Action 2);

realign taxation and relevant substance to restore the intended benefits of international standards and to prevent the abuse of tax treaties (Action 6);

assure that transfer pricing outcomes are in line with value creation, through actions to address transfer pricing issues in the key area of intangibles (Action 8);

improve transparency for tax administrations and increase certainty and predictability for taxpayers through improved transfer pricing documentation and a template for country-by-country reporting (Action 13);

address the challenges of the digital economy (Action 1);

facilitate swift implementation of the BEPS actions through a report on the feasibility of developing a multilateral instrument to amend bilateral tax treaties (Action 15); and

counter harmful tax practices (Action 5).

The OECD recommendations will be a key item on the agenda when G20 finance ministers next convene at a meeting hosted by Australia’s Finance Minister Joe Hockey on 20-21 September in Cairns, Australia.

The proposed measures were agreed after a transparent and intensive consultation process between OECD, G20 and developing countries and stakeholders from business, labour, academia and civil society organisations.

These recommendations may be impacted by decisions taken with respect to the remaining elements of the BEPS Action Plan, which are scheduled to be presented to G20 Governments for final approval in 2015. At that point Governments will also address implementation measures for the Action Plan as a whole.

For further information on the OECD/G20 Base Erosion and Profit Shifting Project, including an Explanatory Statement, a background document, FAQs and the first deliverables to the G20, go to: www.oecd.org/tax/beps-2014-deliverables.htm.

Media queries should be directed to Pascal Saint-Amans, Director of the OECD Centre for Tax Policy and Administration, (+33 6 2630 4923) or the OECD Media Office (+33 1 4524 9700).

 

 

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