The OECD continues to move towards taxation of the giants of the digital

L’OCDE poursuit son avancée vers une taxation des géants du numérique

Photo: Damien Meyer Agence France-Presse
If we think of the giants like Google, Apple, Facebook and Amazon, the target is more broad to encompass businesses engaged in cross-border activities.

After paralysis of seven years, the work leading to a multilateral approach in the field of taxation of the giants of the digital could deliver a solution as soon as 2020.

“The OECD announced today that the international community has made significant progress towards obtaining a solution to address the fiscal challenges raised by the digitization of the economy, and agrees to continue to work in a multilateral way in order to find a long-term solution based on consensus by 2020 “, one reads in the press release of the Organization of economic cooperation and development published Tuesday.

In the Face of blocking a multilateral approach, countries including France, the United Kingdom and Spain have made gestures isolated in order to impose the giants of the digital in their respective countries. In Quebec, the budget 2018-2019 provides for the establishment of a new system of registration for the QST for suppliers outside of Quebec and outside of Canada making taxable sales in Quebec. In short, the intensification of these approaches unilateral would have contributed to the impasse can be resolved. Analysts speak of the emergence of a power relationship have been because of the american blockade and the reluctance of German.

By doing this, “States and jurisdictions participating in the inclusive Framework for OECD/G20 on the erosion of the tax base and benefits transfer (BEPS) are intensifying their efforts to find a solution, coordinated with the debate growing on the most appropriate way to impose multinational companies in the context of an economy that scans quickly,” says the OECD.

If we think of the giants like Google, Apple, Facebook and Amazon, the target is more broad to encompass businesses engaged in cross-border activities. “The States agreed to examine potential solutions that modernized the tax principles fundamental […] where companies can be heavily involved in the economic life of different jurisdictions without having a physical presence significant, and that new elements of creation of value, often intangible, are more important “.

The works are grouped under two central pillars. They should lead to the drafting of a document-a synthesis to feed into the public consultation, held on 13 and 14 march in Paris, at the meeting of the reflection Group on the digital economy. The first pillar focuses on the allocation of the right to tax the income of multinational corporations among the various courts, including the traditional rules of transfer pricing and the principle of arm’s-length price. The second ” will consider two interdependent rules that are designed to provide the courts with tools for the case of income are subject to zero taxation or very low “.

All part of a goal of simplicity and respect for the freedom of countries or jurisdictions to determine their own tax rate or do not have a tax on the profits of companies, does one care to emphasize.

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