OECD checks in on tax regimes that have agreed to reduce harmful tax practices
The OECD reports significant progress in the international effort to curb harmful tax practices and ensure that preferential tax regimes align taxation with substance, according to a newly released progress report.
The OECD report—Harmful Tax Practices - 2018 Progress Report on Preferential Regimes—provides an update on just under 60 tax regimes and looks at whether they have delivered on their commitment to comply with the international standard on harmful tax practices (i.e., Action 5 of the base erosion and profit shifting (BEPS) project).
The OECD has now reviewed 255 regimes from 70 jurisdictions since the start of the BEPS project.
Among other things, this report concludes that:
BEPS Action 5 "revamps" the work on harmful tax practices with a focus on improving transparency, including compulsory spontaneous exchange on rulings related to preferential regimes, and on requiring substantial activity for preferential regimes such as intellectual property (IP) regimes.
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