The increased diversification of the digitised economy presents a major challenge for BEPS initiatives. Lack of a permanent establishment (PE) had led to debate over where tax should be applied, even where a digital entity is not practising a tax avoidance strategy. The prospect of amended tax legislation to address this has raised concerns over the increased risk of double taxation, and a regulatory burden on multinationals.
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The OECD had previously missed a June 30 deadline to agree an MLC on amount A; in other news, UK corporation tax bills surged to a record high last year