SAT responds fast to the first batch of BEPS deliverables
On 16 September 2014, the Organisation for Economic Co-operation and Development (OECD) released the first batch of deliverables for changing the international tax rules in connection with base erosion and profit shifting (BEPS). Seven of the fifteen areas of the BEPS Action Plans were covered at this stage.
China’s State Administration of Taxation (SAT) rapidly announced its views on 17 September and also provided the Chinese translation of the OECD reports. The announcement noted the SAT’s contribution to and continuous supports for the BEPS project to curb BEPS arrangements through international cooperation.
This development is of vital importance to both tax authorities and multinational enterprises (MNEs) in China. Formulating and implementing relevant international and domestic rules and standards is likely to be a long-term process, but MNEs should be clear and conscious that they would probably face new tax compliance requirements and challenges to the way they structure or carry out their businesses in China.
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