Members of the OECD/G20 Inclusive Framework on Base Erosion and Profit Shifting (BEPS) have continued to make steady progress in the fight against tax treaty abuse, according to the latest peer review published on Wednesday, 20 March.
Tax treaty abuse—and treaty shopping in particular—generally involves an attempt by a person to indirectly access the benefits of a tax treaty between two jurisdictions without being a resident of one of those jurisdictions. To address this problem, all members of the Inclusive Framework have committed to implementing a minimum standard and participating in a periodic peer-review process so as to verify that it is being implemented properly.
The BEPS Multilateral Instrument—the main tool used to apply the minimum standard—continues to have a significant impact and is now strengthening the bilateral tax treaty network of jurisdictions that have ratified it.
In 2023, around 1,360 agreements concluded between members of the Inclusive Framework were in compliance with the minimum standard, that being around 30% more than in 2022. In total, over 2,400 agreements concluded between members of the Inclusive Framework were compliant, were the subject of a compliance instrument, or were the subject of measures taken by at least one treaty partner to apply the minimum standard.
Read the peer review: https://aeur.eu/f/bhj (Original version in French by Anne Damiani)