The CIOT has submitted its comments on the OECD’s proposals for pillar two of its international solution for taxation of multinational enterprises in the digital economy. Pillar two is concerned with the global anti-base erosion (GloBE) system, a set of rules for ensuring minimum levels of taxation.
In its submission, the CIOT describes the GloBE proposal as ‘far too complex’.
‘It is not clear whether the fundamental principle underlying the proposal is to achieve a minimum effective tax rate for any entity, either in that entity or at shareholder level; or whether it is to allow countries to protect their own tax base from base eroding payments’, the CIOT submission states.
For the CIOT, the fundamental question yet to be addressed is how the four main components (the income inclusion rule, undertaxed payments rule, switch-over rule, and subject to tax rule) will interact. The institute suggests a ‘much simpler route’ to achieve the income inclusion rule may be to focus on existing CFC rules. See bit.ly/33LsrXw.
On 9 December, the OECD will hold its public consultation meeting in Boulogne. This meeting will focus on the key questions identified in the consultation document published on 8 November and issues raised in the written submissions received as part of that consultation. A compilation of the written comments received was published on 3 December (see bit.ly/33JTHp1).
The CIOT has submitted its comments on the OECD’s proposals for pillar two of its international solution for taxation of multinational enterprises in the digital economy. Pillar two is concerned with the global anti-base erosion (GloBE) system, a set of rules for ensuring minimum levels of taxation.
In its submission, the CIOT describes the GloBE proposal as ‘far too complex’.
‘It is not clear whether the fundamental principle underlying the proposal is to achieve a minimum effective tax rate for any entity, either in that entity or at shareholder level; or whether it is to allow countries to protect their own tax base from base eroding payments’, the CIOT submission states.
For the CIOT, the fundamental question yet to be addressed is how the four main components (the income inclusion rule, undertaxed payments rule, switch-over rule, and subject to tax rule) will interact. The institute suggests a ‘much simpler route’ to achieve the income inclusion rule may be to focus on existing CFC rules. See bit.ly/33LsrXw.
On 9 December, the OECD will hold its public consultation meeting in Boulogne. This meeting will focus on the key questions identified in the consultation document published on 8 November and issues raised in the written submissions received as part of that consultation. A compilation of the written comments received was published on 3 December (see bit.ly/33JTHp1).
