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Fighting fiscal injustice: the work of the OECD on taxation of digital economy

Doc. 15251: compendium of written amendments | Doc. 15251 | 20/04/2021 | Final version

Caption: AdoptedRejectedWithdrawnNo electronic votes

ADraft Resolution

1The Parliamentary Assembly of the Council of Europe, enlarged to include the delegations of national parliaments of the Organisation for Economic Co-operation and Development (OECD) member States which are not members of the Council of Europe and a delegation from the European Parliament, underlines that the ability of governments to raise funds through taxation necessary for the funding of public services is a fundamental anchor for democracy.

In the draft resolution, at the end of paragraph 1, add the following words:

"and social justice."

In the draft resolution, at the end of paragraph 1, add the following sentence:

"The Enlarged Assembly welcomes the signing of an updated co-operation agreement (Memorandum of Understanding) between the Council of Europe and the OECD in December 2020, which confirms both Organisations’ mutual interest in promoting shared values and objectives, inter alia, in relation to sustainable development and tax matters."

2The digitisation of the economy and the rise of tech giants (including GAFA, namely Google, Amazon, Facebook, Apple), the aggressive tax planning, tax avoidance and artificial profit shifting practices, adopted by numerous multinational corporations, the increased awareness of the general public to these practices and the worsening state of public finances caused by the 2008 global economic crisis and the Covid‑19 pandemic have made the need for internationally co-ordinated policy responses more urgent than ever before.
3While most value in the digital economy is created through virtual and stateless platforms, the Enlarged Assembly considers that it is necessary for States to be provided with a broader tax base again to cover their public financing needs, in particular by moving away from the concept of “permanent establishment” that underpins the traditional model for the distribution of the international tax base.
4The Enlarged Assembly welcomes the OECD’s work on the Inclusive Framework on Base Erosion and Profit Shifting (BEPS). It notes that the first of the many actions in the Inclusive Framework concerns policy responses for the tax challenges arising from the digital economy, and endorses the breakdown of the policy proposals into two pillars: the first Pillar addresses the broader issues of taxation of the digital economy and focuses on how taxing rights are determined (namely nexus) and how taxable profits are allocated among jurisdictions. The second Pillar tackles the remaining BEPS issues related to tax planning, through the establishment of a global minimum tax.
5It welcomes the OECD’s instrumental role in this context and the progress made in the work on Pillar 1 and the adoption of a joint statement outlining the general framework of the discussions for the two pillars. It encourages the participating States to continue this work with a view to a consensus-based agreement on both pillars.

In the draft resolution, after paragraph 5, insert the following paragraph:

"The Enlarged Assembly also supports the OECD’s work in promoting global standards for collecting value-added tax from online sales of goods, services and digital products, including as regards international exchanges through the platform economy. It furthermore welcomes the OECD’s guidance on taxing virtual currencies and crypto-assets aimed at developing a new tax reporting framework by the end of 2021."

6The Enlarged Assembly stresses that multilateralism, provided that it is genuinely inclusive, is the best means of achieving tangible results. It considers that achieving consensus at international level is the best way to reform the international tax system, to restore stability to the international tax framework and to avoid the risk of further unco-ordinated, unilateral tax measures which could trigger trade sanctions.
7To ensure fair taxation of global corporate profits, the Enlarged Assembly urges the OECD and member States to:
7.1further support and promote the Inclusive Framework on Base Erosion and Profit Shifting (BEPS) in reaching a consensus-based agreement comprising Pillars 1 and 2 within the envisaged timelines;

In the draft resolution, at the end of paragraph 7.1, add the following words:

"and, if necessary, seal off the areas where a broad multilateral consensus has been reached by concluding an interim agreement by mid-2021;"

7.2facilitate the application of the agreed multilateral instrument to existing tax treaties;
7.3avoid and reverse a race to the bottom of national tax systems, which could undermine governments’ legitimate financing abilities in maintaining sound public finances and high-quality social services for all;
7.4adopt rules on transparency and automatic exchange of information for tax purposes between all countries in order to ensure tax fairness and compliance by both corporate entities and individuals;

20 April 2021

Tabled by the Committee on Social Affairs, Health and Sustainable Development

Votes: 71 in favor 2 against 7 abstentions

In the draft resolution, paragraph 7.4, replace the word “adopt” by the following word:


In the draft resolution, at the end of paragraph 7.4, add the following words:

"and push for public country-by-country reporting by enterprises;"

7.5develop mandatory disclosure rules regarding aggressive or abusive transactions, arrangements or structures;
7.6propose measures for countering harmful tax practices more effectively, with a priority on improving transparency, including compulsory spontaneous exchange of rulings relating to preferential regimes (fiscal rulings) and on requiring substantial activity for the granting of any preferential regime;

In the draft resolution, after paragraph 7.6, insert the following paragraph:

"co-ordinate national fiscal policies and instruments for more effective carbon emissions pricing in support of action to curb climate change;"

7.7promote international coherence in corporate profit taxation, so that the design of tax policy is better informed by the increasing interconnectedness of economies and the gaps that can be created by interactions between domestic tax laws;
7.8do more to take account of the needs and interests of developing countries in the design of a new post-BEPS international tax system.

20 April 2021

Tabled by the Committee on Social Affairs, Health and Sustainable Development

Votes: 77 in favor 3 against 10 abstentions

In the draft resolution, at the end of paragraph 7.8, add the following words:

"that is multilateral and at least as inclusive as the proposed Inclusive Framework."