Tax Policy

Con­sul­ta­tion on Tax Chal­len­ges of Digi­ta­li­sa­tion

The OECD has held a public consultation on the tax challenges of digitalisation. The related "public consultation document" of the OECD summarizes alternative approaches reforming the existing international tax system. The OECD aims for an agreement until 2020. Insurance Europe has commented to the OECD's work on possible solutions to the tax challenges of digitalisation.

Insurance Europe pointed out the manifold problems and constraints that have to be considered in the future work of the OECD.

Focus on aggressive base erosion and profit shifting

The OECD’s initial proposals go far beyond the mere taxation of digital business models and would lead to fundamental changes in the existing international tax system. Insurance Europe pointed out, that legislative action with regard to digital business models should be limited to aggressive base erosion and profit shifting. The existing international tax system as such should not be challenged.  

Feasible adaptions instead of burdensome legal uncertainty

Both pillars of the proposal are too vague at this stage and would therefore result in significant legal uncertainty and increased administrative burdens for taxpayers and tax authorities. The innumerable problems resulting from such a profound change to the international tax system have not adequately been considered yet. Therefore Insurance Europe highlights the necessity of fundamental principles as the avoidance of double taxation or the fiscal recognition of losses.

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