OECD Update 111th meeting VAT Committee 30 November 2018 taxud.c.1(2018)6699290 OECD Update 111th meeting VAT Committee 30 November 2018

(Centre for tax policy and administration) Organisation OECD Global Forum on transparency and exchange of information (EOI) for tax purposes CFA (committee for fiscal affairs) FTA (Forum on Tax Administration) WP9 on consumption taxes WP10 on EOI and tax compliance Task force on digital economy CTP (Centre for tax policy and administration)

FTA Created in 1997 to act as focal point for CFA work on tax administration Forum where tax administration can exchange their experiences in addressing existing and future strategic challenges Aims Share information and experiences on tax administration issues Service and compliance approaches Performance measurement and management Share thoughts on emerging administrative challenges

Members Mandate Working Party 9 Almost all Member States (23 MS) Big third country economies (US, Australia, New Zealand, Canada, Japan, South Korea, Turkey…) International associations (EU, ATAF, CIAT, CREDAF, IMF, WB, UN) Academics Cooperation/partnership also with China, Russia, South Africa Members Forum for discussing issues relating to consumption tax policy and administration Developing international VAT/GST guidelines Assisting non-OECD economies to improve the design and operation of their consumption tax systems Assisting member countries through the publication of comparative data and information concerning the application of consumption taxes through the development of tools for measuring the efficiency of VAT/GST systems Mandate

Working Party 10 Objectives Output Provide strategic policy, legal, administrative and technical support to develop and improve EOI and mutual administrative assistance Strengthen international co-operation Enhance countries’ ability to tackle fraud, evasion and aggressive tax planning Output Develop international standards, guidelines and best practices Forum to discuss and co-ordinate policies Interpret standards and develop guidance and training on EOI Organise meetings of tax inspectors and specialists Cooperate closely with FTA Mainly active in the field of corporate taxation

Task force on digital economy Providing policy, legal, administrative and technical support to advance the work identified in the BEPS (Base erosion and profit shifting) Action 1 Final Report, “Addressing the Tax Challenges of the Digital Economy” Mandate Monitor developments that may affect tax policy Emerging trends in technology, innovation and business models related to the digitalisation of the economy Their impact on value creation Their impact on tax policy and its implementation Monitor developments in the regulation of the Digital Economy Options relating to the new nexus – significant economic presence Options to apply a withholding tax on certain digital services Options to introduce an “equalisation levy” Monitor and evaluate the effectiveness of measures implemented and of the international standards Act as centre of expertise on issues related to the digital economy and engage with stakeholders Tasks Interim report end of 2018 Recommendation for further action in final report by end 2020 Timing

Work on digital taxation OECD Task Force met on 10-11 July 2018 in Paris Continued work after adoption of the interim report on tax challenges arising from the digitalisation Was follow-up of Communiqué of G20 Finance Ministers and Central Bank Governors of 19-20 March 2018 https://back-g20.argentina.gob.ar/sites/default/files/media/communique_g20.pdf Next meeting scheduled for 4-5 December To discuss note by OECD to elaborate on concrete proposals made at the last meeting The Presidency is coordinating the EU position

Enhanced role of marketplaces in collection of VAT/GST Content of the interim report It gives an overview of the different roles that can be allocated to marketplaces in order to enhance their responsibility in the collection of VAT/GST Varies from merely providing information to dealing with joint and several liability, responsible for collection and finally the deemed supplier model Includes experiences from countries already having implemented this type of provisions Australia and New Zeeland have allocated a tax collection obligation for marketplaces Singapore has introduced rules for collecting GST from marketplaces in relation to e-services The EU will introduce in 2021 a deemed supplier model for certain transactions Some countries have introduced joint and several liability rules for marketplaces Others have introduced extra reporting obligations for marketplaces

WP9 report - Roles for digital platforms in the VAT collection process Voluntary roles: Collection, supplier education, co-operation agreements… Information sharing obligations Liability to collect/remit without imposing full liability (e.g. joint and several liability) Full VAT/GST liability

Enhanced role of marketplaces in collection of VAT/GST Discussions in TAG (Technical Advisory Group) Composed of delegates from tax administrations and business representatives Mainly couriers and marketplaces raised comments Observations are included in the document discussed in WP9 Discussions in WP9 and next steps Text was almost finalised at the last WP9 meeting 6-9 November 2018 Major part of the report is devoted to the deemed supplier model and the extra reporting obligations that could be imposed on marketplaces => The EU policy on marketplaces is well reflected in the paper Report is supposed to offer countries a series of possible alternatives that can be used as to enhance the role of marketplaces Report will be formally adopted at the Global Forum meeting in Melbourne – end March 2019

VAT/GST aspects of sharing economy Issue raised at the last WP9 meeting in November Several jurisdictions gave presentations on how they tax Uber or Airbnb At last meeting presentations from Blablacar and booking.com who raised following concerns: Uncertainty over the nature of service provided: intermediary service, electronic service or the underlying supply Need for: clear rules/legal certainty, automated processes, proportionality, avoidance of double or non-taxation, appropriate time for implementing changes A common approach on taxing their activities Governments concerns: => diversity of models in the sharing economy  difficult to have a clear-cut general definition for the service OECD will propose to set up a team of countries willing to take the lead on this file Will be discussed with business in TAG and reporting back to WP9

VAT/GST aspects of sharing economy Next steps Proposal will be launched most likely at the Global Forum to allow work to start as of Q2 2019 Quite some interest from business community and from several jurisdictions Action at EU level – follow up on Working paper N°878 Vat Treatment of sharing economy