OECD BEPS - Multilateral Instrument: Treaty Abuse

Principal Purpose Test

The OECD’s Multilateral Instrument (MLI ), which as of 1 January 2020 has been signed by 93 countries has the potential to impact significantly the ability of groups to rely on double tax treaties to manage and reduce taxes imposed across borders, such as withholding tax.

The MLI is expected to affect the interpretation and application of more than 1600 tax treaties without the need for any bilateral negotiations between countries.

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