New reporting obligations in the horizon for sharing economy

OECD releases model rules for data reporting by platform operators for sellers in the sharing economy

On February 2020, the Organisation for Economic Co-operation and Development (OECD) released a consultation document on model rules for reporting of data by platform operators with respect to sellers in the sharing and gig economy.

The interest in a common set of data reporting rules parallels the European Commission's interest in amending the European Union (EU) Directive on Administrative Cooperation (Directive 2011/16/EU, also known as the DAC) to facilitate the collection and exchange of data from digital platform operators by national tax authorities.

The aim of this project is to ensure the effective taxation of the sale of goods or services in the sharing and gig economy, a current demand of the labour and tax system in every development economy and included in the OECD interim report to the G20 on Tax Challenges Arising from Digitalisation.

The consultation document asserts that the presence of online platforms providing a wide assortment of transaction between users in the sharing or gig economy is changing the way to do business and, therefore, tax administrations need to adapt their compliance strategies to include this new kind of economy.

Also, it declares that this is a moment of opportunity for tax administrations to take advantage from the way that these digital platforms carry out their business, like some jurisdictions have already introduced reporting measures for platform operators. Nevertheless, it is important to consider that dealing with various reporting requirements could lead to costs and barriers to further development for platform providers.

In the same way, the idea of the European Commission is to establish a common EU reporting standard in this area. With this aim, it has opened a public consultation to reinforce the exchange of information in the field of taxation and update the EU DAC to include the ability for tax administrations to collect and exchange taxpayer data collected by digital platform providers.

The model rules for reporting by platform operators will have important consequences and some jurisdictions have already introduced new rules with this purpose. In Germany, for instance, new reporting liabilities in regard to the VAT are combined with a joint and several liability since 2019, as Austria also did this year. The implementation of model rules in the entire OECD will surely contribute to similar rules´ application by other jurisdictions.

 B Law & Tax
International Tax & Legal Advisors

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