The OECD has released guidance on implementing country-by-country (CbC) reporting, as set out in Action 13 Report “Transfer Pricing Documentation and Country-by-Country Reporting” of the base erosion and profit shifting (BEPS) project.
The CbC reporting, under which MNEs will be required to provide information about their economic activity within the MNE group on an annual basis, is one of the key priorities of OECD in addressing BEPS risks. The aim of the guideline is to set out:
The OECD has stressed the importance of consistent and swift implementation of CbC reporting. The guidance has informed that multinational groups are already making preparations for CbC reporting, and dialogue between governments and business is a critical aspect of ensuring that CbC reporting is implemented consistently across the globe. "Consistent implementation will not only ensure a level playing field, but also provide certainty for taxpayers and improve the ability of tax administrations to use CbC reports in their risk assessment work," the guidance informed.
A short 10-page guidance has further informed that the OECD will provide information on country specific aspects of CbC implementation, including the effective dates of CbC legal frameworks, local filing and surrogate filing mechanisms, and identifying the agreements for exchange of CbC reports that are in effect.
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