Harmful Tax Practices – 2017 Peer Review Reports on the Exchange of Information on Tax Rulings

Pakistan

Pakistan has met all aspects of the terms of reference (ToR) for the calendar year 2017 (year in review) that can be met in the absence of rulings in scope being issued and no recommendations are made.

Pakistan does not issue any type of rulings within the scope of the transparency framework.

As no rulings were issued, no exchange of information was required. No peer input was received in respect of the exchanges of information on rulings received from Pakistan.

Introduction

968.  This peer review covers Pakistan’s implementation of the BEPS Action 5 transparency framework for the year 2017. The report has four parts, each relating to a key part of the ToR. Each part is discussed in turn. A summary of recommendations is included at the end of this report.

A. The information gathering process

969.  Pakistan does not issue any type of rulings within the scope of the transparency framework. Pakistan only issues advanced tax rulings to non-resident taxpayers setting out the tax consequences to a transaction proposed or entered into by the taxpayer, regardless whether income is generated through a permanent establishment or not. The tax rulings, once issued, are binding for the tax authorities. However, the rulings issued by Pakistan do not determine or decide on the existence or the absence of a permanent establishment or provide for how much profit will be attributed to a permanent establishment and are therefore not considered rulings as defined in the Action 5 report (OECD, 2015). As no rulings are issued, this section is not assessed.

B. The exchange of information

970.  As no rulings are issued, this section is not assessed.

C. Statistics (ToR IV)

971.  As no rulings are issued, no statistical data can be reported.

D. Matters related to intellectual property regimes (ToR I.4.1.3)

972.  Pakistan does not offer an intellectual property regime for which transparency requirements under the Action 5 Report (OECD, 2015) were imposed.

Summary of recommendations on implementation of the transparency framework

 

Aspect of implementation of the transparency framework that should be improved	Recommendation for improvement
	No recommendations are made.

References

OECD (2017), BEPS Action 5 on Harmful Tax Practices – Terms of Reference and Methodology for the Conduct of the Peer Reviews of the Action 5 Transparency Framework, OECD/G20 Base Erosion and Profit Shifting Project, OECD, Paris. www.oecd.org/tax/beps/beps-action-5-harmful-tax-practices-peer-review-transparencyframework.pdf.

OECD (2015), Countering Harmful Tax Practices More Effectively, Taking into Account Transparency and Substance, Action 5 - 2015 Final Report, OECD/G20 Base Erosion and Profit Shifting Project, OECD Publishing, Paris. https://doi.org/10.1787/9789264241190-en.