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Pillars one and two blueprints raise heavy admin burden, says CIOT

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The CIOT has published a detailed response to the OECD’s pillar one and pillar two blueprints on taxation of the digital economy. The CIOT welcomes the continued work by the OECD/G20 and the progress made towards developing a solution to the tax challenges of the digitalisation of the economy and a consensus-based, long-term reform of the international tax system. However, the CIOT is concerned about the level of administrative burden that the current proposals would bring and therefore recommends that the next stage should focus on the practicalities of any agreed solution, aiming to minimise the tax administrative burdens to the greatest extent possible and ensure that the solutions result in a set of new rules which is proportionate to the intended objectives.

The CIOT also notes that a mid-2021 deadline to reach consensus seems ambitious and urges caution around any timetable for implementation of new rules. The CIOT recognises that time taken to implement the changes must be balanced against the prospect of a large number of individual and jurisdiction-specific rules aimed at the digitalised economy which are increasingly being introduced in a number of countries.

Issue: 1514
Categories: News