OECD: Regulated financial services exclusion under Amount A of Pillar One; public consultation
Comments are requested by 20 May 2022.
Amount A of Pillar One; public consultation
The Organisation for Economic Cooperation and Development (OECD) today issued a release seeking public comments on the regulated financial services exclusion under Amount A of Pillar One—part of the ongoing work of the OECD/G20 Inclusive Framework on base erosion and profit shifting (BEPS) in implementing the two-pillar solution to address the tax challenges arising from the digitalisation of the economy.
As explained by today’s OECD release,
- The regulated financial services exclusion will exclude from the scope of Amount A the revenues and profits from regulated financial institutions.
- The defining character of this sector is that it is subject to a unique form of regulation, in the form of capital adequacy requirements, that reflect the risks taken on and borne by the firm.
- The scope of the exclusion derives from that requirement, meaning that entities that are subject to specific capital measures (and only those) are excluded from Amount A.
The OECD/G20 Inclusive Framework on BEPS agreed to the release of the public consultation document [PDF 1 MB], in order to solicit public comments, but as noted in today’s release, “… it does not reflect consensus regarding the substance of the document.” According to the OECD, the comments received will assist members of the Inclusive Framework in further refining and finalizing the relevant rules.
Comments are requested by 20 May 2022.
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