IOTA Forum on Implementation of Measures to Counter Base Erosion Profit Shifting (BEPS)

Following opening remarks by Samson Uridia, Head of the International Relations Department at the Georgia Revenue Service, we filled the conference room with thought-provoking presentations along with specified case studies from the IOTA member countries of Azerbaijan, Austria, Belgium, Croatia, Denmark, Finland, Italy, Portugal, Spain, and Sweden in order to explore and discuss strategies, practical approaches, and best practices on issues such as 2 Pillars Solution, CbCR processing of data, hybrid mismatch arrangements, complex transfer pricing transactions, and joined audits. The IOTA Forum on BEPS also aims to create opportunities for its members to work collaboratively towards meeting the emerging challenges of implementing the BEPS measures. 

During the first day of the event, participants received the latest updates on the OECD’s proposed 2 Pillars solution, from our international partner organisation, the OECD, and also heard country presentations on the challenges faced so fat through the implementation  of Pillar 2 from a Finish and Danish tax administration perspective.

• OECD – Latest Updates on Pillar 1 Amount B/ Latest Updates on Pillar 2 presented by Laura Stefanelli;
• Finland – Implementation of Pillar 2 legislation in Finland presented by Minttu Karppelin;
• Denmark – Implementation of Pillar 2 in a Danish context presented by Lars Louv-Jansen.

This session was followed by a brief update on the work of the Forum’s Sub-Groups through a presentation of the IOTA Expert, Alexandros Roukalis.

The second day of the BEPS Forum featured informative sessions and insights from IOTA member administrations. The focus was on practical experiences with using data from the exchange of CbC Reporting, data utilisation, and challenges faced by tax administrations, even through the live demonstration of IT tools created internally for the automatic process of CbCR data. The event also included 2 real case study presentations, one from Italy on identifying a hybrid mismatch arrangement by utilising BEPS Action 2 and BEPS Action 13, and one from Portugal, by presenting the adopted approach on an issue of examining the appropriate use of profit-split method and functional characterisation of a local company. Subsequently, participants were divided into groups to discuss and provide feedback on these studies. The aim was to emphasize practical applications rather than theoretical concepts during the event. Within this session, the following member countries reflected on the topic:

• Sweden – How has the evolvement of CbC data visualisation contributed to a more efficient analysis of the information and a more productive work presented by Urban Jakobsson;
• Denmark – CbC Reporting, experiences so far, exploitation of data presented by Ole Norman Dam.

On the last day of the event, participants discussed transfer pricing issues related to complex intra-group transactions, followed by a presentation on the implementation of BEPS Actions from Azerbaijan, and explored joint audit cooperation in practice from Croatia.

• Austria – Delineation of cash pool deposits co-presented by Horst Rinnhofer & Alexander Knapp;
• Spain – Financial intra-group transactions, a practical approach presented by Israel Munoz Diaz;
• Belgium – Restructuring and transfer pricing presented by Filip Haes;
• Azerbaijan – Implementation of BEPS Actions in Azerbaijan: Future Prospects presented by Jeihun Ismailov;
• Croatia – Joint audit cooperation in practice presented by Davor Burić.

These sessions were followed by a panel debate with the assistance of the Steering Group Members: Laura Stefanelli, Lillemor Unsbo, Dachi Kinkladze, and Valentino Rosselli, on commenting on the performance and positive aspects of the agenda topics while also discussing the direction that should be given for the future. At the last session of the Forum on BEPS,  participants contributed through sharing their feedback through respective poll questions on which should be the priorities for the FY2025 agenda, on which BEPS Actions the Forum should Focus, and whether a new subgroup should be formed.

All the materials, presentations, and photos are now available online, and the event recording will soon be uploaded to the event's webpage. This event was facilitated by the IOTA International Taxation Expert Alexandros Roukalis with support from his colleague Ivana Donchevska. We also would like to extend a big thank you and gratitude to the Georgia Revenue Service for collaborating with us and making this event possible.