SouthViews No. 191, 13 March 2020
India and recent updates on the OECD/G20 Inclusive Framework’s Two-Pillar Approach
By Subhash Jangala
The Organisation for Economic Co-operation and Development (OECD)/Group of Twenty (G20) Inclusive Framework in its January 2020 Statement has affirmed the commitment to arrive at a consensus-based solution to the tax challenges arising out of digitalization of the economy by the end of 2020 and take forward the on-going discussion on the two-pillar approach. This article examines some of the key issues in the Statement for developing countries, such as the scope, new nexus rules, role of accounting standards and proposed source rules. India’s proposal on profit attribution through a two-factor apportionment using employees and assets is mentioned as a potential option for country-wise thresholds in the new nexus.
Download the SouthViews below:
This article was tagged: Accounting Standards, Automated Digital Services, Base Erosion and Profit Shifting Project (BEPS), Digital Economy, Digital Taxation, Group of 20 (G-20), Inclusive Framework, India, Market Jurisdiction, Multinational Enterprises (MNEs), Organisation for Economic Co-operation and Development (OECD), Permanent Establishment, Profit Attribution, Tax Cooperation, Tax Law, Tax Policy, Tax Reform, Two-Pillar Approach