KPMG report: Comments on public consultation documents on implementation under Pillar Two
In response to request for comments, KPMG tax professionals submitted a memo with comments
Comments on public consultation documents on implementation under Pillar Two
The Organisation for Economic Cooperation and Development (OECD) on 20 December 2022 issued—as 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—an implementation package under Pillar Two consisting of:
- Guidance on safe harbours and penalty relief [PDF 414 KB]
- Public consultation document on the global anti-base erosion (GloBE) information return [PDF 1.1 MB]
- Public consultation document on tax certainty for the GloBE rules [PDF 329 KB]
As explained in the accompanying OECD release:
- The guidance on safe harbours and penalty relief includes the agreed terms of a transitional country-by-country (CbC) reporting safe harbour that effectively removes the obligation of calculating the GloBE effective tax rate for a multinational enterprise’s (MNE’s) operations in lower-risk jurisdictions in the initial years, thereby providing relief to MNEs in respect of their GloBE compliance obligations as they implement the rules. The document also includes the framework for the development of permanent safe harbours as simplified income and tax calculations, as well as a common understanding as to a transitional penalty relief regime which requires careful consideration for applying penalties or sanctions where an MNE has taken reasonable measures to ensure the correct application of the GloBE rules.
- The public consultation document on the GloBE information return seeks input on the amount and type of information that MNE groups will be expected to collect, retain and/or report for the application of the GloBE rules and possible simplifications that could be incorporated in the GloBE information return as well as the ability of the MNE group to provide alternative data points.
- The public consultation document on tax certainty for the GloBE rules outlines various mechanisms, including dispute prevention and dispute resolution, for achieving tax certainty under the GloBE rules. The document outlines the expected next steps in connection with the development of these mechanisms and identifies a number of areas where stakeholder input would be valuable.
In response to the OECD request for comments, KPMG tax professionals submitted:
- A memo with comments [PDF 286 KB] on Pillar Two – GloBE Information Return
- A memo with comments [PDF 210 KB] on Pillar Two – Tax Certainty for the GloBE Rules
Read all of the KPMG comment letters to the OECD on BEPS
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