THE DIGITAL GIANTS are one step closer to being taxed after more than 110 countries and jurisdictions agreed to work towards a shared approach to taxing the digital economy in the next two years.
According to the Organisation for Economic Cooperation and Development (OECD), the countries will review two key concepts of the international tax system, the “nexus” and “profit allocation” rules, and work towards a consensus-based solution by 2020, as set out in their Interim Report on the Tax Challenges Arising from Digitalisation.
The report will be presented by OECD Secretary-General Angel Gurría to the G20 Finance Ministers at their meeting this week in Buenos Aires, Argentina.
“The international community has taken an important step today towards resolving the tax challenges posed by the digitalisation of the economy,” said Gurría, in the news release. “We have underlined the complexity of the issues, and highlighted the importance of reaching international agreement, both for our economies and the future of the rules-based system. The OECD stands ready to accompany countries as they seek to build a common understanding of the issues related to the digital economy and taxation, as well as the long-term solutions.”
