Working party no. 1 (Double taxation)
The main task of working group 1 is to seek solutions to improve the OECD Model Convention on the avoidance of double taxation.
Working group 1 is currently dealing with technical issues in connection with the taxation of resident persons by their state of residence and the mutual agreement procedure. Furthermore, it is preparing the report for the first review of the implementation of BEPS Action 6 (treaty abuse). Working group 1 also addresses issues arising from the OECD's work on the tax challenges posed by the digitalisation of the economy.
The work of working group 1 will be incorporated into the next edition of the OECD Model Convention and its commentary, expected to be published in 2021.
Working party no. 2 (Tax policy analysis and tax statistics)
The main task of working party no. 2 is to analyse current topics in tax policy. Working party no. 2 usually meets twice a year.
The working party is responsible for numerous publications published annually:
- The "Tax Policy Reforms in the OECD" publication was first published in 2016 and provides an overview of significant changes in all tax matters.
- The "Revenue statistics" publication presents a series of detailed and internationally comparable data in a common format for all OECD member states since 1965. Each "Revenue statistics" also contains a special topic. In the 2016 edition, problems relating to the reporting of tax receipts were analysed.
- The "Taxing wages" publication compares the evolution of wages before and after taxes and certain social contributions of an average employee in each country and contains information on taxes paid on wages in OECD countries. This publication also contains a special topic in each edition. The latest edition (2018).
Furthermore, the working party no. 2 maintains a tax database which is publicly available online. This provides comparative information on a range of tax statistics such as tax receipts, income taxes, non-tax levies, corporate and capital taxes and consumption taxes in the 35 OECD countries.
Finally, working party no. 2 is continuing its work on action 11 of the BEPS action plan and is particularly concerned with the existing databases and indicators for measuring the BEPS phenomenon. The future publication of "Corporate Tax Statistics" will initially be based on publicly available data and in a second step on country-by-country reporting.
Working party no. 6 (Taxation of multinationals)
The current mandate of working party no. 6 is to continue its work on transfer pricing issues and to amend the OECD Transfer Pricing Guidelines for multinationals and tax administrations where necessary. Working party no. 6 meets on average twice a year.
Working party no. 6 also monitors the implementation of the OECD Transfer Pricing
Guidelines. Finally, working party no. 6 continues a dialogue with jurisdictions that have not adopted the OECD Transfer Pricing Guidelines so that these jurisdictions can become familiar with and adhere to these principles.
In July 2017, the OECD published a new version of the Transfer Pricing Guidelines. This new version introduced the transfer pricing changes resulting from the BEPS project. Work on the OECD Transfer Pricing Guidelines is currently continuing in working party no. 6.
Working party no. 9 (consumption taxes)
Following the adoption of the International VAT Guidelines by the OECD Council in September 2016, working party no. 9 drafted a report on the implementation of the guidelines published in October 2017. In the first chapter, different possibilities of value-added taxation in the country of destination are presented. The second chapter deals with issues relating to the collection of tax from companies not established in the country of destination and the third chapter deals with simplified registration for companies not established in the country of destination. The role of digital platforms in the value-added taxation of online offerings is now a key issue that a sub-group with Swiss participation is dealing with. Working party no. 9 usually meets twice a year.
Working party no. 10 (exchange of information)
Working party no. 10 develops the legal and technical regulations for the international exchange of information, deals with their further development and thus ensures the effectiveness of the international exchange of information standards. One part of this work is a joint action plan to combat loopholes in the global standard for the automatic exchange of financial account information. Working party no. 10 usually meets twice a year.
Working party no. 11 (aggressive tax planning)
Working party no. 11 was formed as part of the BEPS project. It is responsible for the following four actions of the BEPS project: neutralise the effects of hybrid mismatch arrangements (action 2), strengthen controlled foreign company rules (CFC rules, action 3), limit base erosion via interest deductions and other financial payments (action 4) and require taxpayers to disclose their aggressive tax planning arrangements (action 12). Working party no. 11 usually meets twice a year.
Since the adoption of the final reports in October 2015, working party no. 11 has undertaken further work on specific points. In December 2016, for example, additional clarifications were published in connection with the limitation of interest deductions (action 4; regulation of the permissible deduction rate at group level and the application of the rules limiting interest deductions to the banking and insurance sectors). In addition, expert comments were published in August 2017 on hybrid mismatch arrangements (action 2) which identified hybrid mismatch arrangements with branches and sets out rules to harmonise their treatment with the recommendations from the final report on BEPS action 2. In addition, working party no. 11 participated in the work of working party no. 10 on model disclosure rules for intermediaries.
Forum on Harmful Tax Practices
The Forum on Harmful Tax Practices began reviewing the minimum standard for transparency of advance tax rulings, as well as the minimum standard for patent boxes and comparable tax regimes (BEPS action 5) in 2017. The Forum meets on average twice a year.
A progress report on the implementation of the minimum standard for patent boxes and similar regimes was published in October 2017. The list and status of the regimes are regularly updated.
The implementation of the minimum standard for the transparency of advance rulings in tax matters is subject to annual reviews. The first review report, which covers the year 2016, was published in December 2017.
Forum on Tax Administration FTA
The Tax Administration Series publication provides an insight into the various tax administrations and enables comparisons with them. A wide range of data, analysis and country examples is used to take into account the most important aspects of tax administrations (organisation, strategic priorities, risks, etc.). It also highlights current trends and reforms. The Tax Administration Series 2017 was published at the FTA Plenary Meeting in Oslo in September 2017.
The FTA is also concerned with improving the practical implementation of the Mutual Agreement Procedure (MAP). The FTA MAP Forum is particularly important in the context of the BEPS project, as it reviews the implementation of the standard on dispute resolution in double taxation cases (action 14).
In addition, Switzerland is actively involved in the following FTA programmes:
The Large Business International Programme (LBIP) discussed the appropriate and effective use of country-by-country reports. As part of this work, LBIP has developed two handbooks to assist tax administrations in their implementation.
The Joint International Taskforce on Shared Intelligence and Collaboration (JITSIC) is committed to fighting tax evasion more effectively and efficiently. JITSIC offers tax administrations an agile mechanism for the exchange of information and cooperation. At the same time, it ensures that the exchange of information complies with the provisions of an agreement on the exchange of tax information. Switzerland has been a member of the JITSIC network since April 2016 and participates in certain projects. Since the publication of the "Panama Papers" on 3 April 2016, the members of the JITSIC network have undertaken to cooperate more closely. For this purpose, a common procedure was developed for the information available which is currently applied to the data in the "Paradise Papers".
Within the framework of the Tax Debt Management Network, innovative approaches in connection with behaviour analysis are being sought with which the outstanding tax debts can be reduced and better collected. Among other things, the best practices of various countries are being discussed. The Enhancing International Tax Debt Collection project was also launched from this programme. It deals with the best practices of tax administrations in the field of international tax collection. A "How to" guide for international debt collection as well as the difficulties of tax administrations and possible solutions are being discussed.
Within the framework of the Sharing and Gig Economy working group, joint solutions for outstanding tax issues are to be developed. It examines how unnecessary burdens can be avoided and how tax services for small businesses can be improved.
In addition to existing and new projects, there have been Communities of Interest (COIs) sponsored by individual commission members since 2018. In these, some of the previously completed FTA projects are continued or taken up again in smaller groups. The FTA Secretariat participates in the COIs, but does not organise them. Switzerland participates in the COI on digital transformation sponsored by Russia which continues the work of the E-Services and Digital Delivery project, and the COI on analytics sponsored by Ireland which discusses advanced analytics.