Global Daily Tax News, Tax Agencies To Collaborate On Pillar Two Implementation, (Oct 16, 2023)

Tax agency officials agreed to collaborate on the implementation of the new Pillar Two global minimum tax, at the annual plenary meeting of the OECD's Forum on Tax Administration (FTA).

The meeting, held on October 11-13, 2023, in Singapore, brought together tax commissioners and delegates from across the globe, including representatives from international organizations, regional tax administration bodies, industry, and academia.

Tax commissioners agreed to collaborate on tax administration modernization efforts, under the so-called Tax Administration 3.0 initiative. They agreed to support one another to increase the use of new technology tools to boost compliance rates, drive down tax gaps, and significantly reduce compliance burdens.

The Tax Administration 3.0 initiative is aimed at embedding taxation processes in the natural systems that taxpayers use in their daily lives and businesses, to make tax compliance and administration seamless. The work currently centers on assigning a digital identity to taxpayers in respect of their digital transactions; rolling out electronic invoicing; and including tax processes in gig and sharing economy applications.

On the implementation of the Pillar Two minimum tax, commissioners agreed to explore how cooperation can be enhanced between tax agencies, to support compliance and boost certainty.

Finally, commissioners agreed to work more closely with international and regional organizations on the concurrent work to support developing nations to develop technical capacity.

Bob Hamilton, Chair of the FTA and Commissioner of the Canada Revenue Agency, said: "We have agreed an ambitious and wide-ranging agenda that will help us bring significant benefits to taxpayers. Delivering this agenda will require a strong emphasis on collaboration and partnering with international organizations, regional tax organizations, business and academia. I am confident though that together we can overcome the challenges ahead of us, as we have a shared desire to make the most of the opportunities this hugely important agenda brings."