Meet the METR

We republish here an article written by several BMG members, together with other colleagues, first published in Tax Notes International on 15 February 2021.

The article explains and analyses our suggested revised version of the OECD’s proposed global anti-base erosion tax (the GLOBE), a minimum effective tax rate for multinationals (the METR). This presents in more detail the proposal first made in our comments of December 2019 on the Pillar Two proposals.

Our METR is a more equitable, far less complex, and more practical variant on the GLOBE, and could be introduced by a coalition of willing states.

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BEPS Monitoring Group Comment
Submission on the Pillar One and Pillar Two Blueprints

These blueprints are a testament to the commitment and efforts of many dedicated government and OECD officials, and provide many building blocks for potential solutions. Regrettably however, the proposals as a whole do not deliver on the mandate for the BEPS project to align taxation of multinational enterprises (MNEs) with where their activities occur and value is created.

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BEPS Monitoring GroupComment
Tax Consequences of the Digitalised Economy - Issues for Developing Countries

We welcome the Committee’s decision to work independently on the tax consequences of digitalisation, and support the proposal of one of its members to give priority to developing a new definition of taxable nexus for automated digital services. To cover services more generally, it should also review provisions of the UN model tax treaty on taxation of income from services and related aspects of attribution of profits.

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BEPS Monitoring GroupComment
Country by Country Reporting

We have made a submission to the consultation by the OECD on behalf of the Inclusive Framework for BEPS, for its review of the system of Country by Country Reporting (CbCR).

While we welcome the establishment of the system, we note that very few developing countries have yet received any reports, and are concerned that instead of being an effective transparency measure it is being used to discipline how countries apply their own tax rules. It’s now time to require publication of CbCRs, which do not contain commercially confidential information, and improvements to the template should not change this. Key improvements include revision of the definition of a Constituent Entity to include all activities that may create taxable presence, and clarification that tax paid should refer to the country that receives the tax.

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BEPS Monitoring GroupComment