Compliance with base erosion and profit shifting action 13: Insights from tax consultants and tax officials

Compliance with base erosion and profit shifting action 13: Insights from tax consultants and tax officials

Tax compliance
Transfer pricing documentation
Tax consultants
Tax officials

To combat firms exploiting transfer pricing as a tool for tax avoidance, the Organisation for Economic Cooperation and Development (OECD) introduced the Base Erosion and Profit Shifting Action 13 (BEPS 13),
enhancing tax transparency and the exchange of information with tax authorities. Interviewing senior-level transfer pricing advisors and tax officials, we investigate how and why multinational enterprises (MNEs)
respond to this new regulation. By conducting this research, we contribute to the scarce literature assessing the impact of tax disclosure to tax authorities and, specifically, the implications of BEPS 13. The study finds that MNEs attach more importance to tax compliance and are more averse towards tax avoidance, which is mainly driven by higher audit pressure. Additionally, MNEs experience additional costs to comply with the different implementations in countries, centralise tax data with IT systems within the organisation, and set up multilateral
Advance Pricing Arrangements (APAs) and Mutual Agreement Procedures (MAPs). To avoid (other forms of) tax avoidance being considered by companies, policymakers should address these concerns of increased compliance costs.

Annelies Roggeman , Leila Aro-Sati , Isabelle Verleyen

https://www.sciencedirect.com/journal/european-research-on-management-and-business-economics/vol/31/issue/1

Elsevier Espana, S.L.U

5 December 2024

Sri Wahyuni

ISSN: 2444-8834

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Jurnal Internasional European Research on Management and Business Economics 2025