Tax Insights

Keep up to date on current anti-avoidance measures

In the wake of unprecedented political and social scrutiny over the tax affairs of multinationals, policy makers throughout the globe are increasingly looking for new and improved ways to address the perceived threat of ongoing tax avoidance.

To safeguard against such concerns, many countries are seeking to institute a range of legislative measures to broaden the enforcement capabilities of revenue authorities, including:

the introduction of new domestic general anti-avoidance rules (GAARs),
extending the scope of existing GAARs, and
introducing or refining a series of more specific anti-avoidance rules (SAARs) to deny taxpayers the benefits of an arrangement where an impermissible tax related purpose exists.

Despite the swift (and often extensive) legislative responses made to date, there appears little evidence of concern amongst policy makers about the increased complexity and uncertainty that accompanies the introduction of such measures. Whilst in times past legislators often sought to improve the design and administration of their primary taxing rules to achieve an identified policy objective countries are now increasingly seeking to introduce GAARs and GAAR like measures as a ‘last resort’ defense to curtail incidence of tax avoidance.

As a consequence of the near unparalleled work of the OECD as part of its Base Erosion and Profit Shifting (BEPS) project, the trend of policy makers promulgating such measures has often been supplemented by complementary actions directed at elevating the level of tax reporting and tax information sharing amongst sovereign governments. This phenomenon will have the desired effect to better arm revenue authorities to verify and challenge the positions adopted by multinationals in their cross-border dealings and will without doubt lead to increased investigations and GAAR disputes in the future.

As a result of these developments taxpayers will need appreciate and understand the elevated importance of GAARs and consequently develop new and appropriate strategies for addressing the growing compliance complexity this produces in a post BEPS environment.

To help those multinationals navigate these complexities and keep appraised of key global developments, PwC has prepared the series of insights below.

Download 'Anti-abuse' themes in the OECD's Final BEPS Reports

The OECD’s BEPS project has garnered widespread acknowledgment of the need for reform.

Download Unilateral 'anti-avoidance' action as a precursor to the BEPS recommendations - UK and Australian perspectives

A look at the unilateral legislative actions taken by the UK and Australia to address perceived tax avoidance behaviours.

Download Recent global developments in general anti-avoidance rules

GAARs continue to play a pivotal role in tax regimes as a safeguard intended to thwart incidents of tax avoidance.

The information contained within these Insights will arm multinational taxpayers with the most current and up to date information regarding the prevalence and scope of current anti-avoidance measures and highlight the potential future state which will no doubt increase the complexity in cross border tax compliance.