The OECD has published Amount A:draft model rules for nexus and revenue sourcing for consultation, which it describes as containing ‘the first building blocks under pillar one for which public input will be sought, relating to nexus and revenue sourcing’.
The ‘revenue sourcing’ rules set out the detail necessary to identify the end market for specific categories of transactions, although the OECD acknowledges the challenges of accurately identifying the market jurisdiction and associated revenue while limiting compliance burdens. The OECD’s accompanying press release notes that ‘striking the balance between accuracy and operational realities is a challenge in any rule design. Stakeholder input will be especially valuable in identifying cases where this balance could be better achieved, and finalising the delivery of revenue sourcing rules that achieve the desired policy objective but at the same time are practical and avoid unnecessary burdens.’
The consultation runs until 18 February 2022. The OECD intends to consult in stages on its work on both pillars ‘rather than waiting for a comprehensive document to be ready’, with further consultations planned on Amount B in ‘mid-2022’ and various aspects of pillar two from the end of February 2022.
The OECD has published Amount A:draft model rules for nexus and revenue sourcing for consultation, which it describes as containing ‘the first building blocks under pillar one for which public input will be sought, relating to nexus and revenue sourcing’.
The ‘revenue sourcing’ rules set out the detail necessary to identify the end market for specific categories of transactions, although the OECD acknowledges the challenges of accurately identifying the market jurisdiction and associated revenue while limiting compliance burdens. The OECD’s accompanying press release notes that ‘striking the balance between accuracy and operational realities is a challenge in any rule design. Stakeholder input will be especially valuable in identifying cases where this balance could be better achieved, and finalising the delivery of revenue sourcing rules that achieve the desired policy objective but at the same time are practical and avoid unnecessary burdens.’
The consultation runs until 18 February 2022. The OECD intends to consult in stages on its work on both pillars ‘rather than waiting for a comprehensive document to be ready’, with further consultations planned on Amount B in ‘mid-2022’ and various aspects of pillar two from the end of February 2022.
