BAKU, Azerbaijan, Azerbaijan has joined international efforts against tax evasion and avoidance by joining the Organization for Economic Co-operation and Development (OECD) Inclusive Framework on Base Erosion and Profit Shifting (BEPS), Trend reports via OECD.

According to the OECD, over 135 countries and jurisdictions participate to date in the agreement.

The OECD notes that as a participant in the framework program, Azerbaijan is committed to the introduction of minimum BEPS standards to solve tax problems arising from the digitalization of the economy.

“Collaborating on an equal footing with all other members of the Inclusive Framework, Azerbaijan will participate in the implementation of the BEPS package of 15 measures to tackle tax avoidance, improve the coherence of international tax rules and ensure a more transparent tax environment,” said the organization.

According to the OECD, Azerbaijan has also committed to addressing the tax challenges arising from the digitalization and globalization of the economy by joining the two-pillar plan to reform the international tax rules and ensure that multinational enterprises pay a fair share of tax wherever they operate.

Under the two-pillar package, pillar one aims to ensure a fairer distribution of profits and taxing rights among countries with respect to the largest multinational enterprises (MNEs). Taxing rights on more than $125 billion of profit are expected to be reallocated to market jurisdictions each year, with developing country revenue gains expected to be greater than those in more advanced economies, as a proportion of existing revenues.

Pillar two is directed to limit the competition over corporate income tax, through the introduction of a 15 percent global minimum corporate tax rate that will apply to companies with revenue above 750 million euros.

“Countries are aiming to sign a multilateral convention for implementation of pillar one by mid-2023, for entry into force in 2024. For pillar two implementation, a number of countries have begun the process of incorporating the global minimum tax rules into domestic legislation to be effective in 2023,” the organization added.

Source: TREND News Agency