Progress continues in combatting harmful tax practices as new outcomes on the review of preferential tax regimes have been approved by the OECD/G20 Inclusive Framework on BEPS, which groups 139 countries and jurisdictions on an equal footing for multilateral negotiation of international tax rules.

At its April 2021 meeting, the Forum on Harmful Tax Practices (FHTP) took new conclusions on 25 regimes as part of the implementation of the BEPS Action 5 minimum standard. The results are as follows:

  • Based on an earlier government commitment, the Australian Offshore banking regime has now been abolished, with grandfathering provided to existing taxpayers within the FHTP’s timelines.
  • The Philippines will abolish its Regional operating headquarters regime as of 1 January 2022 (without grandfathering) and is “potentially harmful but not actually harmful” for the time being.
  • The United States has also confirmed its intention to abolish the Foreign derived intangible income (FDII) regime, which has therefore been classified as “in the process of being eliminated”.
  • Government commitments were also made for six other regimes that are now “in the process of being amended/eliminated” (Dominican Republic, Gabon, Sint Maarten and Jordan).
  • As Trinidad and Tobago was not able to fulfil its commitment to abolish its Special economic zone regime within the agreed timelines, it is now considered “harmful”.
  • Two newly introduced regimes were concluded as “not harmful” (Hong Kong (China) and Georgia).
  • The FHTP reviewed 12 regimes for the first time and these are now “under review” (Armenia, Eswatini, Honduras, Lithuania and Pakistan).

Since the start of the BEPS Project, the FHTP has reviewed 309 regimes. The next set of reviews is expected to take place in the last quarter of 2021.

Transfer pricing country profiles updated to include new information

The OECD has also made updates to the transfer pricing country profiles, which now contain new information on countries’ legislation and practices regarding the transfer pricing treatment of financial transactions and the application of the Authorised OECD Approach to attribute profits to permanent establishments.

Updates to the transfer pricing country profiles are conducted in batches. The profiles for 20 jurisdictions have been updated in the first batch, including three new country profiles from Inclusive Framework members (Angola, Romania and Tunisia) bringing the total number of countries covered to 60. The work will continue throughout the second half of 2021 and the first half of 2022.

The transfer pricing country profiles focus on countries’ domestic legislation regarding key transfer pricing aspects, including the arm’s length principle, methods, comparability analysis, intangible property, intra-group services, cost contribution agreements, documentation, administrative approaches to avoiding and resolving disputes, safe harbours and other implementation measures.

The OECD has published transfer pricing country profiles since 2009. In 2017, the country profiles were significantly modified to reflect the changes in the transfer pricing framework of jurisdictions as a result of the 2015 OECD/G20 Base Erosion and Profit Shifting (BEPS) Project reports on Actions 8-10 and on Action 13 which introduced revisions to the OECD Transfer Pricing Guidelines.

To access the latest transfer pricing country profiles, visit:


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