BEPS Action 1, Pillar 1 And Pillar 2 A Canadian Perspective

The OECD has proposed a new approach to international taxation- an expanded  jurisdiction to tax and a formulary approach to replace the "arm's length standard" in  transfer pricing. Ostensibly, the new regime is being introduced in order to forestall the  proliferation of Digital Services Taxes on a per-country basis, with the resulting risk of  double or triple taxation, and to address the supposed "race to the bottom of corporate  taxes".

• Under BEPS Action 1, Pillar 1, it was agreed by 140 countries worldwide to adopt new profit allocation and nexus rules so that 25% of large multinational enterprises'  residual profits are redistributed to the countries in which consumers are located.  Market jurisdictions would then have a new taxing right over those residual profits.