Proposal for a Global Taxation System
– DAGTVA truth table –
DAGTVA® – Distribution of MNE profits
|No.||Problems exposed, requests, constraints and subjects||Origin||Pg||Li||Doc|
|81||Ap – calculate benefits by industry, region and / or market.||Pillar 1||14||13||RBAcb|
Quote : Appendix – Detailed proposal on profit allocation
Amount A (RBAag)
53. The starting point for the determination of Amount A would be the identification of the MNE group’s profits. The relevant measure of profits could be derived from the consolidated financial statements8 (RBAae) under the accounting standards of the headquarters jurisdiction prepared in accordance with the Generally Accepted Accounting Principles (GAAP) or the International Financial Reporting Standards (IFRS). The advantages of such an approach are that consolidated financial statements are (1) normally readily available and (2) not easily manipulated. To better approximate a proxy of residual profit, further consideration will need to be given to the appropriate measure of profits and also to potential standardised adjustments to the reported profit (as per the consolidated financial accounts). In addition, the fact that the profitability of an MNE group can vary substantially across business lines, regions or markets suggests that the relevant measure of profits may need to be determined on a business line and/or regional/ market basis (RBAcb – RBQrc – RBAbr).
Following on from the sections cited in the question, this subject has already been dealt with in the RBAbp section.