Global Daily Tax News, Report Maps West African States' Progress On Tackling BEPS, (Nov 30, 2023)

The OECD has released a new case study on the organization's work with regional organizations to support West African nations to broaden their tax bases and tackle tax base erosion and profit shifting and illicit financial flows.

The report notes that outcomes of the work have included the development of three Community tax instruments dealing with transfer pricing, beneficial ownership, and mutual administrative assistance in tax matters.

The instruments were adopted by the ECOWAS Council of Ministers in July 2023. ECOWAS member states must transpose the Transfer Pricing and Beneficial Owner Community tax instruments into domestic law by 31 December 2026 and 1 January 2027, respectively.

The Directive on transfer pricing is intended to support the region's tax agencies to effectively monitor groups' intra-group prices, to ensure they comply with the arm's length principle; and better target tax audits at companies that present the greatest tax risks. The instrument is also intended to enhance the legal certainty of taxpayers and improve the business climate in the region.

The beneficial ownership Directive, meanwhile, is intended to enable the identification of the individuals who ultimately own or control a legal person or a legal arrangement such as a trust, including through the creation of domestic registers.

Under the agreement on mutual administrative assistance in tax matters, the countries are to share information spontaneously and on request and cooperate in undertaking simultaneous tax audits and provide assistance in the recovery of tax claims.

The case study also highlights work undertaken to support the countries to undertake a review of their tax treaties, which resulted in the publication of one consolidated report as well as individual reports for each West African state.

Finally, the case study sets out the various events that took place during the year to increase the capacity of local tax agencies in international tax matters.