Base Erosion and Profit Shifting (BEPS) Action Plan

Minimum standards for parts of the international tax system were agreed under the base erosion and profit shifting (BEPS) Action Plan as part of recommendations published in October 2015.  The BEPS Inclusive Framework (IF) comprises around 130 countries committed to implementing those minimum standards – see the list of IF members on the OECD website. Alongside the minimum standards, which applied to elements of four of the fifteen action items, there were identified a number of best practices and areas for greater alignment.

Work stemming from the BEPS Action Plan

Further BEPS work

  • IF countries are participating on an equal footing in follow-up work to the BEPS Action Plan, including financial transactions
  • The Action 1 recommendations have grown into a much broader project on the taxation of the digitalisation of the economy, on which extensive work is being carried out

Tax Platform toolkits

  • The Platform for Collaboration on Tax comprises the UN, IMF, World Bank and OECD
  • This Tax Platform is developing a series of toolkits
  • The main aim is to assist “lowest income countries” in implementing the outcomes of the BEPS Project, so far as they are relevant to those countries or to address related issues

Implementation of minimum standards (for all IF countries)

  • Harmful tax practices, including exchange of rulings (minimum standard)
  • Treaty abuse, including the Principal Purpose Test (minimum standard)
  • Country-by-country reporting (minimum standard)
  • Dispute resolution via mutual agreement procedures (minimum standard)

Other significant issues

  • Multilateral instrument (MLI) for effecting treaty-based BEPS changes
  • The EU’s Mandatory Disclosure Regime (DAC6)
  • The EU’s Anti Tax Avoidance Directive (ATAD)

The BEPS Project had been initiated by the G20 countries but it effectively also encompassed the other OECD Member States from the outset. As the project progressed, engagement in the discussions was extended to other large non-OECD states and representatives of developing countries. PwC submitted a large number of responses in relation to the various BEPS proposals put forward action by action. The OECD published over 1600 pages in the ‘final’ reports in relation to all 15 BEPS Action items in October 2015 and the wider range of IF countries became individually involved.

BEPS Action Plan: Action 1 -

The digital economy

BEPS Action Plan: Action 2 -

Hybrid mismatch arrangements

BEPS Action Plan: Action 3 -

Controlled foreign companies (CFC) regimes

BEPS Action Plan: Action 4 -

Financial payments

BEPS Action Plan: Action 5 -

Harmful tax practices

BEPS Action Plan: Action 6 -

Treaty abuse

BEPS Action Plan: Action 7 -

Permanent establishment (PE) status

BEPS Action Plan: Action 8 -

Transfer pricing and intangibles

BEPS Action Plan: Action 9 -

Transfer pricing and risks/ capital

BEPS Action Plan: Action 10 -

Transfer pricing and other high-risk transactions

BEPS Action Plan: Action 11 -

Data and methodologies

BEPS Action Plan: Action 12 -

Disclosure of aggressive tax planning

BEPS Action Plan: Action 13 -

Transfer pricing documentation

BEPS Action Plan: Action 14 -

Dispute resolution mechanisms

BEPS Action Plan: Action 15 -

A multilateral instrument

It may take some while for the impact of these recommendations to be fully applied in practice, but the BEPS Project and related developments are constantly leading to the need for business to take action (in some cases, urgent action) both to comply with new requirements and to consider the ways in which they do business in different countries. 

Latest key comments on BEPS


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Will Morris

Will Morris

Global Tax Policy Leader, PwC United States

Tel: +1 202 213 2372

Edwin Visser

Edwin Visser

Deputy Global Tax Policy Leader, EMEA Tax Policy Leader, PwC Netherlands

Tel: +31 88 792 3611

Aamer Rafiq

Aamer Rafiq

Partner, PwC United Kingdom

Tel: +44 207 212 8830

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