On 18 November 2020 The OECD has published statistics on the latest communication procedure (MAP), including 105 jurisdiction and almost all MAP cases worldwide. This action is the implementation of the so-called minimum BEPS Action standard 14 and a broader tax security programme G20/OECD, which was launched to improve the effectiveness and timeliness of tax dispute resolution mechanisms.
MAP Statistics 2019 MAP awards 2019 were presented during second OECD Tax Surety Day, at which tax officials and stakeholders from above 60 The jurisdictions summarised the tax security programme and discussed ways to further improve the prevention and resolution of disputes between taxpayers and tax administrations. Discussions on the economic impact of the crisis COVID-19, they concerned a wide range of tax tools, including prior price agreements (APA), the International Compliance Programme (ICAP), bilateral and multilateral MAP communication procedures and the work of the Tax Administration Forum on benchmark.
Dispute resolution mechanisms, including MAPs, are the basis for a well-functioning network of tax treaties. Minimum BEPS Action Standard 14 accepted 2015 by OECD /G20 members on BEPS aims to improve the resolution of tax disputes between jurisdictions and includes a peer review mechanism to monitor the compliance of Member States' jurisdictions with this minimum standard.
For the purpose of producing statistics, the evaluation has been made 82 jurisdictions and 1500 recommendations issued. The OECD Secretariat has drawn up proposals to strengthen the BEPS minimum standard of action 14.
These proposals address all aspects of the MAP process (prevention of disputes, access to the MAP, resolution of MAP cases and implementation of MAP agreements), as well as reporting rules for MAP statistics. The OECD expects feedback from taxpayers, given that taxpayers are the main recipients of MAP procedures.
Analysis of statistics per 2019 allows to observe the following general trends concerning MAP procedures worldwide:
The number of cases is increasing steadily. In 2019 ed 7 MAP cases per day (3 Transfer pricing cases and 4 other cases). That means almost 2700 new cases in themselves 2019.
It's more than in 2018 (20% on transfer pricing and 10% in other cases) and almost double increase in relation to 2016 This trend is likely to continue despite the evolution of the epidemic situation COVID-2019.
The OECD indicates that this situation is affected by a number of factors, including increased globalisation, but also increasing confidence and knowledge of the MAP process.
The number of cases completed also increases, but at a slower rate. Tax administrations have closed more cases in 2019 more than 2018, However, the increase in this efficiency in resolving cases is not adequate to the increase in the number of new cases. As a result, open cases continue to grow in most jurisdictions, despite the fact that competent authorities have increased their capacity and in 2019 compared to 2016 closed around 50% more transfer pricing cases and 70% More other cases.
The results of most of the cases under consideration under the MAP procedures are positive. Around 85% MAP transfer pricing proceedings in 2019 The solution fully addressed the issue (compared to 80% In 2018), which reflects an improvement in the attitude open to cooperation with taxpayers by tax administrations. Other 70% the case has been fully resolved (compared to 75% In 2018). The number of MAP proceedings completed without an agreement was approx. 2% cases, which means maintaining a similar trend as in 2018.
The timing of cases is still pretty long. On average, 2019 a period of approximately 25 months (31 months for transfer prices, 22 months in other cases). In addition, data at the end 2019 show that over one fifth pending cases await resolution from above 4 years. In some jurisdictions, cases that were pending before the minimum standard was introduced and statistics were kept (i.e. before 2016), above 40% their overall state at the end 2019
As part of the Tax Surety Day, awards were also awarded – so-called MAP Awards, which are awarded in recognition of the special efforts of the competent authorities. Japan became the winner – due to the shortest time in closing transfer pricing cases, ex aequo with the UK, which also won a prize for other cases.
Belgium was also among the other jurisdictions highlighted, due to the lowest percentage of open cases before 2016, and Belgium and Norway – due to the most efficient management of the impact of cases.
The joint prize for the couples of jurisdictions, which dealt most effectively with the joint cases, was awarded to India and Japan for transfer pricing cases, and to Norway and the United States for other cases.