FEE has commented on the OECD’s project for a “co-ordinated international approach to combat tax avoidance by multinational enterprises’’. Hereby the OECD focusses on the artificial shift of profits across borders to take advantage of tax rates that are lower than in the country where the profit is made.

As part of their Action Plan to combat BEPS, the OECD issued a public discussion paper on Action 6: “Preventing Treaty Abuse”. In its response, FEE compared the OECD’s proposals to modify its Model International Tax Treaty with existing European law. In particular, the recommendations incorporate anti-abuse rules such as a ‘limitations on benefits’ (LOB) provision in tax treaties. FEE suggests that the proposed LOB provisions may need to be redrafted to reflect requirements under EU law, most notably the freedom of establishment.

Relevant Documents

OECD Public Discussion Draft – Follow Up Work on BEPS Action 6: Preventing Treaty Abuse

FEE Comment Letter on OECD Public Discussion Draft – Follow Up Work on BEPS Action 6: Preventing Treaty Abuse