Strategizing Multinational Tax Risks

The G20 recently held a symposium including 300 participants from 60 countries.  The G20 tax agenda focused on the current status of BEPS in developed, and developing, countries.  The PwC summary outlines the current state of agreement, and disagreement, with the proposed BEPS Guidelines.

Click to access pwc-g20-international-tax-symposium.pdf

Key observations:

• Hybrid mismatches will include treaty changes and domestic law recommendations
• The interest limitation solution is not yet adequate
• A clear analytical framework should be used to determine application of non-recognition transactions
• The Amadeus database, macro-data and tax return data was used to measure the spill-over effect of BEPs
• Not all measures to tackle BEPS will be supported by guidance, although guidance will continue in following years
• Coordination and consistency of application is vital, although it is challenged by unilateral actions of residence countries
• Implementation is key, although a single approach no longer works

The observations cited in the PwC summary are insightful, while providing further certainty that BEPS implementation will be diverse with different timelines, while guidance continues in post-2015.