Welcome
Daily Tax Report: International

OECD Still Pushing Ahead on Digital Tax Rewrite Despite Pandemic

April 24, 2020, 2:37 PM

The OECD still aims to deliver a global tax overhaul by the end of the year, even as the coronavirus pandemic continues, the organization’s head tax official said.

The work continues despite calls from business groups for a pause and the challenges of negotiating virtually, said Pascal Saint-Amans, director of the Organization for Economic Cooperation and Development’s Center for Tax Policy and Administration, on a webcast Friday hosted by the U.K. firm Jericho Chambers.

Meanwhile, a growing number of unilateral measures are ratcheting up the pressure on a multilateral solution. As the OECD seeks agreement among nearly 140 countries on a common plan, countries including India and Indonesia have joined France, Italy, and others in enacting unilateral measures to tax digital companies. Those measures may be accelerated by the economic fallout from the crisis, Saint-Amans said.

The OECD had previously said it was trying to reach broad agreement by July, when a meeting was scheduled for negotiators from the countries involved. The OECD did not comment in response to a Bloomberg Tax email on whether the meeting would still be held.

The OECD is working to rewrite the global tax rules that determine how much multinationals—especially tech giants—are taxed in the countries where they have users or consumers.

After the OECD said in March it was moving “full steam” on the project, the U.S. Council for International Business and the German Business Federation (BDI) called for a delay.

International diplomacy isn’t easy to conduct remotely, Saint-Amans said. For that reason, “we can keep going on with the project that exists, but to start new projects we need the vaccine” for coronavirus, he said.

“It’s extremely difficult to negotiate without meeting the people physically,” and technology tools enabling video conferencing don’t replace human interaction, Saint-Amans said.

To contact the reporter on this story: Isabel Gottlieb in Washington at igottlieb@bloombergtax.com

To contact the editors responsible for this story: Meg Shreve at mshreve@bloombergtax.com; Colleen Murphy at cmurphy@bloombergtax.com

To read more articles log in. To learn more about a subscription click here.