Base Erosion & Profit Shifting

Insights from the Asian Pacific region

The OECD’s base erosion and profit shifting (BEPS) project, which commenced in 2013, is producing some of the most significant changes to the taxation of international business in nearly 30 years.

With the debate having reached the highest levels of governments, and with growing attention from the media and the public, BEPS continues to grow in prominence and already, many tax law changes are taking effect around the globe. The OECD’s Action Plan on BEPS was published in July 2013 with a view to addressing perceived flaws in international tax rules. The 40 page Action Plan, which was negotiated and drafted with the active participation of its member states, contains 15 separate action points or work streams, some of which are further split into specific actions or outputs. 

Whilst the OECD finalised its recommendations under the BEPS Action Plan in December 2015, work is ongoing as part of the OECD’s Inclusive Framework on BEPS. The Inclusive Framework brings together over 100 jurisdictions (including developing countries) to collaborate on the implementation of the BEPS Package. Members of the Inclusive Framework will develop a monitoring process for the four minimum standards - Country-by-Country (CbC) Reporting, preventing treaty abuse, resolution of treaty-related disputes and countering harmful tax practice - as well as put in place the review mechanisms for other elements of the BEPS Package. 

Gaining consensus amongst such a large group on the go-forward is likely to be both difficult and time consuming. Many countries have already implemented, or are in the process of implementing, significant changes to their tax systems in line with the BEPS recommendations, adding a new layer of complexity to the international tax system. Multinational companies should be assessing the impact on business operations, and preparing to meet the challenge of the modern tax system.

As work on addressing BEPS continues globally, PwC will be providing strategic analysis of what BEPS means both here in Australia and throughout the Asia Pacific region, leveraging our network of international taxation, transfer pricing and tax controversy specialists from around the world to provide you with insights.

Addressing transparency in an ever changing tax landscape

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Australia signs the OECD's BEPS Multilateral Instrument – 15 June 2017

Australia is one of 76 jurisdictions that sign, or indicated its intention to sign, the Organisation for Economic Cooperation and Development (OECD) Multilateral Convention to Implement Tax Treaty Related Measures to Prevent Base Erosion and Profit Shifting (BEPS) on 7 June 2017.

Roundup of Australia's BEPS developments – 12 April 2017

An update on the status of implementation of all BEPS-related measures in Australia, including those that originate from the OECD BEPS project recommendations and other standalone measures aimed at combating erosion of the tax base. 

Australia: Practical Compliance Guideline PCG 2017/1 released – 1 March 2017

The Australian Taxation Office released final guidance on assessing the transfer pricing risk of hubs and centralised operating models.

Multinationals faced with new measures introducted into parliament – 9 February 2017

We examine two new Bills that will significantly impact large multinationals with Australian investments.

Getting ready for the common reporting standard – 1 February 2017

With the common reporting standard (CRS) obligations commencing from 1 July 2017, we discuss the differences between the CRS and the Foreign Account Tax Compliance Regime.

Adapting to the rise of digital products and services – 1 December 2016

Digital products and services provided to Australian consumers will soon be subject to GST. Are you and your business prepared for the changes ahead?

New tax treaty with Germany: a model for future tax treaties – 1 November 2016

We share our insights into Australia's first '21st century' treaty and what it reveals about how the country will incorporate the OECD's BEPS recommendations in the future.

Unilateral ‘anti-avoidance’ action as a precursor to the BEPS recommendations: UK and Australian perspectives – 14 October 2016

We examine the unilateral legislative actions taken by the UK via the Diverted Profits Tax, and Australia via the Multinational Anti-avoidance Law to immediately address perceived avoidance behaviors of prominent concern.

Australian country-by-country reporting implementation: unique Local File design finalised – 1 June 2016

Under this unique design, specific transfer pricing and business information will be required to be reported in a standardized electronic form. Local Files based on a standard global template may need to be updated for Australia.

Tax transparency in Australia: where are we now? – 1 May 2016

As the global tax landscape rapidly evolves, tax transparency has emerged as a key area of focus for governments and tax authorities around the world.

New measures for special tax investigation adjustments and mutual agreement procedures – 14 April 2017

Is it time to proactively address your international tax risks, such as transfer pricing?

China: key changes are coming – 7 February 2017

Key changes are anticipated in transfer pricing administration in China.

Twenty new measures in China to further open up the economy to foreign investment – 1 February 2017

We analyse the measures most relevant to foreign investors and discuss the opportunities and matters which need to be considered.

China: Leap Ahead – 1 January 2017

2016 China Tax Policy Review and 2017 Outlook

News Flash: China Tax and Business Advisory – 1 December 2016

Interpretation of the key messages delivered at the National Tax Work Conference on the Administration on Large Business Groups

China: transfer pricing administration and investigation – 1 December 2016

How will your obligations change in light of the latest developments in transfer pricing administration and investigation?

China: Standardisation and normalisation of the 'Thousand Groups Project' – 1 November 2016

A new stage of tax administration on large business groups in China

China: SAT's new rules on APAs reflect its thinking on tax administration – 16 October 2016

The new rules presents challenges for taxpayers in managing their APA applications.

China: CRS compliance requirements for financial institutions – 1 October 2016

Discussion Draft on the administrative measures on the due diligence procedures for non-residents' financial account information in tax matters is released for public opinion.

China announces stance on BEPS and localisation plans – 1 October 2016

Multinational companies need to get ready for the challenge of the new requirements on transparency and substance-tax alignment.

New transfer pricing compliance requirements in China – 27 July 2016

SAT has issued new transfer pricing compliance requirements. What are the actions you should undertake as soon as possible?

Further scrutiny on intra-group outbound payments under way – 1 March 2015

What is the State of Administration of Taxation's next important enforcement in response to the Action Plan on BEPS?

News Flash: Hong Kong Tax – 1 November 2016

The HKSAR Government reveals plans for implementing BEPS measures in its consultation paper.

Hong Kong: the BEPS journey – 1 May 2016

Hong Kong is embarking on the BEPS journey. What can we expect?

India: proposed changes to transfer pricing regulations – 28 February 2017

The recently announced Indian Budget 2017 proposes significant amendments to Indian transfer pricing law. We take a deeper dive into the three key proposals.

India's 2017 Budget – 21 February 2017

How will foreign investors and multinational enterprises be affected by the Budget?

India: applying and implementing GAAR – 21 February 2017

The general anti-avoidance rules will take effect on 1 April 2017, and the Indian Central Board of Direct Taxes has offered its opinions on the applicability and implementation. 

BEPS from a global and Indian perspective – 1 February 2017

An outline of the key facets of the 'BEPS world' after the finalisation of the BEPS deliverables, and what's next for India.

TaxFlash from Indonesia – 1 January 2017

The Minister of Finance has issued Regulation No. 213/PMK.03/2016, which regulates the new transfer pricing documentation requirements.

2017 Tax Reform Proposal – 1 December 2016

The 2017 Tax Reform Proposal includes corporate tax measures which are intended to support investments and to reward companies for raising employees salaries. 

Japan: 2016 Tax Reform – 1 June 2016

In order to revitalize the economy as well as target a return of the government deficit to a surplus by 2010, the 2016 Tax Reform aims to support profitable companies by continuing to lower the corporate tax rate while also continuing to expand taxable base. 

Outline of 2016 tax reform pertaining to Japanese transfer pricing documentation – 1 January 2016

An outline of the revised transfer pricing documentation requirements in Japan, with reference to the relevant recommendations in the Action 13 Report.

2015 Tax Reform Act – 1 April 2015

The 2015 Tax Reform Act provides for tax measures to help realise 'economic virtuous cycles', by reducing the effective corporate tax rate from FY 2015.

Korean tax update – 31 March 2017

Covering the latest developments such as the guidance on the CbCR requirements released by the MOSF, the rewritten corporate and individual income tax laws in draft form, the WTO Agreement of Trade Faciliation, and more.

Financial Services: Tax hot topics – 1 January 2017

Keep up with the recent topics that may impact your business, such as the latest transfer pricing developments.

Korea: supplementing the BEPS documentation approach – 5 January 2017

New legislations have been introduced to require qualifying taxpayers in Korea to submit the Combined Report of International Transactions, consisting of a Master file, a Local file, and a Country-by-Country Report, for fiscal years commencing on or after January 1, 2016.

Korea's National Assembly approves 2016 proposed amendments to tax laws – 28 December 2016

We explore the significant changes contained in the amended tax laws and the bills to amend the Presidential Decrees.

Korea: additional reporting requirements on international related party dealings – 7 August 2015

The Ministry of Strategy and Finance announced its proposal to amend the Law for the Coordination of International Tax Affairs to strengthen the requirements for documentation related to transfer pricing in Korea.

Implementing Country-by-Country Report requirements in Korea – 9 August 2016

All domestic corporations and foreign corporations in Korea whose international related party transaction amounts exceed KRW 50 billion and sales revenue exceed KRW 100 billion are required to annually submit the Combined Report of International Transactions, which is comprised of the Master file and the Local file.

Korea: release of the BEPS combined report of international transactions – 18 February 2016

The Ministry of Strategy and Finance announced the amendments to the Law for the Coordination of International Tax Affairs to strengthen transfer pricing documentation requirements on 15 December 2015.

Korea introduces new transfer pricing documentation requirements – 20 January 2016

The Ministry of Strategy and Finance has introduced the Combined Report of International Transactions - what does this mean for transfer pricing documentation requirements in Korea?

Financial Services: Tax hot topics – 1 January 2016

Keep up with the recent topics that may impact your business, such as the latest transfer pricing documentation requirements, and the adoption of the Common Reporting Standard.

MOSF announces Korea's 2015 Tax Reform Proposals – 6 August 2015

The reform proposals' intentions include boosting the sluggish economy and facilitating job creation, as well as to increase transparency regarding sources of tax revenue. We summarise the significant changes contained in these tax reform proposals.

Malaysia implements Country-by-Country Reporting Requirements – December 2016

The new requirements, implemented on 23 December 2016, will come into effect on 1 January 2017.

Next steps in the BEPS journey for New Zealand – 1 March 2017

We take a closer look at the Government's recent discussion documents for the next steps in the BEPS journey for New Zealand.

The next steps in the BEPS journey for New Zealand – 1 March 2017

The New Zealand Government is proposing to make it harder for foreign multinationals to shift profits overseas without economic justification.

New Zealand: what's next? – 1 July 2016

New Zealand is changing international tax rules and relationships. We explore what's next on the horizon.

Addressing hybrid mismatch arrangements – 19 September 2016

On 6 September 2016, the Government released a discussion document outlining the proposals to address hybrid mismatch arrangements.

Tax Tips Alert: New Zealand – 1 December 2016

A summary of the key tax developments in cross-border transactions and investments

Papua New Guinea: 2017 National Budget – 1 January 2017

The 2017 National Budget's theme is 'responsible fiscal consolidation for future growth and development', and key components include projections for the PNG economy.

Singapore: round up of 2016 BEPS developments – 23 February 2017

How will multinational enterprises with operations in Singapore be impacted by the latest developments?

Singapore updated transfer pricing guidelines – 14 February 2017

Singapore has updated its Transfer Pricing Guideliens to incorporate the BEPS Actions developments.

Tax Bulletin: OECD BEPS Project update – 11 October 2016

Singapore tax authorities have issued long-awaited Singapore Country-by-Country reporting implementation guidance.

A new chapter in Singapore's transfer pricing regime – 12 January 2015

The Inland Revenue Authority of Singapore has released revised Transfer Pricing Guidelines, an update to those first published in Febrary 2006.

Taiwan Tax Update – 1 November 2016

Draft 'Regulations Governing Controlled Foreign Companies' and 'Regulations Governing Places of Effective Management'

New transfer pricing decree in Vietnam – 7 March 2017

This decree represents the most important development with respect to Vietnam's transfer pricing regime in the last ten years.

Vietnam: discussion draft of new transfer pricing decree released – 17 October 2016

Dive into the discussion draft and what it may mean for your organisation.

BEPS Working Group established – 5 August 2016

The BEPS Working Group in Vietnam is responsible for preparing action plans to implement the OECD's BEPS initiatives and overseeing the implementation process.

   

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