Committee of Experts on International Cooperation in Tax
Matters is a new entry this year
The UN's tax committee, which is responsible for the
organisation's tax and transfer pricing work, received praise
from the tax community when it released an update to its
highly-regarded transfer pricing manual for developing
countries in April 2017.
The manual, called 'The United Nations Practical Manual on
Transfer Pricing for Developing Countries', was perhaps the
committee's biggest achievement throughout the year. Last
updated in 2013, the manual recommends best practices on
transfer pricing. It was designed to advise developing
countries on administering TP laws by giving concrete examples,
taking into consideration the outputs of the BEPS project.
Nishana Gosai, who was part of the committee, told
International Tax Review in April that although the
first version of the manual was well received, not many
developing countries applied it. However, the updated version
contains more examples of how to apply transfer pricing laws in
situations that developing countries face.
"I do think more developing countries will use the manual.
For example, the updated version has a chapter on services.
This chapter reflects the views expressed by many developing
countries, which regard service payments as base eroding
payments," Gosai said.
ITR also spoke with the coordinator of the
subcommittee on transfer pricing, Stig Sollund, shortly after
the transfer pricing manual was released. Sollund said the
biggest challenge of the committee was pushing for progress
when time was limited and many discussions needed to be made.
"We sometimes had to take decisions or find compromises when
views differed," Sollund said.
The committee replaced its membership midway through 2017,
and the newly elected co-chairs Carmel Peters of the New
Zealand Inland Revenue and Eric Mensah from the Ghana Revenue
Authority have their work cut out to drive the committee's
agenda for the next four years.
The newly elected committee had a meeting in Geneva in
mid-October where it set out a provisional agenda and set
assignments for subcommittees. It elected a new subcommittee
for the digitalisation of the economy, which will discuss how
to deal with taxation of the digital economy in a treaty
context. It also discussed environmental tax issues, dispute
avoidance and resolution, extractive industries taxation, the
UN model tax convention, tax treaty negotiation, protecting the
tax base of developing countries and tax committee practices
and procedures, among other things.
The new committee's agenda also includes considerations of
updates to existing manuals such as the 'Practical Manual on
Transfer Pricing for Developing Countries', the 'Manual for the
Negotiation of Bilateral Tax Treaties' and the 'Extractive
Sollund said he was proud of what the committee had achieved
despite limited resources and time for meetings, and offered
some advice to the new committee members: "My recommendation is
to put even more emphasis on practicability and input from
users in developing countries."