Justice, Equality and Tax Law

S. 1381. Introduction

In October 2021, a statement of the OECD/G20 Inclusive Framework on BEPS (Statement) was issued to address the tax challenges arising from the digitalization of the economy. The OECD and G20 have been discussed for a long time, and the Statement has been called a kind of historic agreement that will change the basic framework of international taxation. However, in the course of the prolonged discussion in the OECD up to the Statement, the subject of taxation and the principles changed significantly. Section 2. of this paper gives an overview of the documents published by the OECD/G20 in chronological order in order to examine the proposed scope and principle changes in the OECD discussions. Then, Section 3. compares the proposed EU Directive on Significant Digital Presence and the digital services tax with essentially the content of the OECD’s October 2021 Statement. Section 4. argues whether the Pillar 1 proposal can achieve just allocation and shows that the principle underlying the new tax regime has been shaken in the course of the discussion in the OECD. In addition, it is followed by a description of certain concerns and objections that emerging and developing countries have raised to the proposal of the OECD. Furthermore, it could be argued that the Statement of the OECD could be a basis for formulary apportionment and could secure procedural justice through tax certainty process.

2. Historical development of OECD’s discussion on Pillar 1

Concerning taxing digital economies, the pioneering study in the OECD was the Ottawa framework report in 1998. The report enumerates the following principles of taxation: Neutrality, Efficiency, Certainty and Simplicity, Effectiveness and Fairness, and Flexibility. The report also concludes that the (a) widely accepted principles mentioned above are applicable to e-commerce, (b) existing taxation rules can essentially implement these principles even in the e-commerce situation, and (c) new administrative or legislative measures or changes to existS. 139ing measures are not precluded as long as they support existing principles and do not impose a discriminatory tax treatment of e-commerce.

Later, under the Committee on Fiscal Affairs (CFA), the OECD set up the Task Force on the Digital Economy (TFDE) in 2013, contemplating the nature of a PE for digital transactions. The status of the discussion at the time in the TFDE was reflected in the BEPS Action 1 Final Report in 2015. This Action 1 report did not recommend that countries introduce a specific system. However, the report states that each country can introduce “as additional safeguards against BEPS” in its own law (i) a new nexus based on a significant economic presence, (ii) a withholding tax on digital transactions, and (iii) an equalization levy. In a retrospective perspective, it may have been problematic in that it could be interpreted that the OECD was not particularly opposed to imposing unilateral digital service taxes (DSTs) thereby making it politically easier for countries to adopt DSTs. The introduction of unilateral DSTs led the United States to initiate the investigations of retaliatory tariffs to digital services taxes that once already escalated into major diplomatic disputes between the United States and other nations.

In February 2019, the OECD released the public consultation document “Addressing the Tax Challenges of the Digitalisation of the Economy”. In this document, three options were presented as the basis for taxation: User-participation, marketing intangibles, and significant economic presence. These three options “seek to expand the taxing rights of the user or market jurisdiction”.

In the Programme of Work in May 2019, the OECD presented three ideas as the new profit-sharing rules: Modified residual profit split method, fractional apporS. 140tionment method, and distribution-based approaches. Among them, the modified residual profit split method is described as a method of allocating to market jurisdictions a portion of the market creation value that is not recognized by the current PE definition. This method coexists with the current transfer pricing rules. The modified residual profit split method becomes the basis for the proposal of the statement in October 2021.

In the secretariat proposal in October 2019, the three options of the public consultation document in February 2019 and the Programme of Work in May 2019 were combined into one unified approach. The secretariat proposal also contains many prototype contents for the latter proposals. For example, consumer-facing businesses (CFBs) and highly digital businesses are within its scope. The consumer-facing businesses are broadly defined as “businesses that generate revenue from supplying consumer products or providing digital services that have a consumer facing element”. Highly digital businesses are defined as the business to “interact remotely with users, who may or may not be their primary customers, as well as other businesses that market their products to consumers and may use digital technology to develop a consumer base”. Furthermore, it proposes the distribution of taxing rights through formulaic allocation for a portion of global residual profits in excess of deemed routine profits.

In October 2020, the blueprint and impact assessment were published. The blueprint is a detailed document with Pillar 1 alone exceeding 200 pages. Only ADSs (automated digital services) and CFBs are subject to taxation in this blueprint. In addition, the OECD has proposed detailed rules for revenue sourcing, segmentation, loss carry-forward, marketing and distribution profit safe harbours, identification of paying entities, and elimination of double taxation.

S. 141In April 2021, according to the tax news media, the United States made a new proposal to the OECD. This proposal has not been officially published but, according to the leaked document, it suggests that the distinction among ADSs, CFBs, and other non-covered businesses in the blueprint be abolished, and all businesses are subject to Amount A with a simple threshold based on the MNE’s global revenue and profitability ratio.

The OECD statement in October 2021 seems to reflect the US proposal. The statement covers all businesses with thresholds based on the MNE’s global revenue and profitability ratio. In February 2022, the OECD published the consultation documents on revenue sourcing and tax base determinations. The OECD explains that the public consultation will be carried out for each item of the statement “on a rolling basis”. In July 2022, the OECD published the Progress Report and showed the outline of the technical design of the Amount A.

As a result, on a political level, an agreement on the OECD/G20 inclusive framework has been reached.

3. Comparison of the OECD proposal and the EU proposal

The previous chapter introduced the trajectory of the discussion in the OECD, but the OECD is not the only international organization to make proposals on tax challenges of the digitalisation of the economy. This chapter will focus on the Significant Digital Presence (SDP) Directive and the Digital Service Tax (DST) S. 142Directive in the EU and compare them with the OECD’s latest proposal. The SDP and DST proposals were proposed in the EU but not adopted by the Member States. They have already lost political momentum. However, a comparison with the OECD will make it clearer what the OECD's proposal focuses on.

3.1. Scope

Under the statement and explanation of the blueprint, Pillar 1 consists of the following three components: Amount A, which is “a new taxing right for market jurisdictions over a share of residual profit calculated at an MNE group (or segment) level”; Amount B, which is “a fixed return for certain baseline marketing and distribution activities taking place physically in a market jurisdiction” in line with the arm’s length principle (ALP); and processes to improve tax certainty through effective dispute prevention and resolution mechanisms.

According to the OECD Statement addressing the two pillars, Pillar 1 covers MNEs above a certain revenues and profits threshold regardless of the type of business. The threshold is combined with global turnover above EUR 20 billion and profitability above 10 percent. Extractives such as oil, gas, and mining industries and regulated financial services are excluded.

As for the draft EU directive on the SDP proposal, a significant digital presence is deemed to exist “if the business carried on through it consists wholly or partly of S. 143the supply of digital services through a digital interface”. It does not matter whether the locations of the enterprises providing the services are in a Member State or a third country. However, the tax treaty between Member States and the third country has to be revised for the application of an SDP clause to a third country. This SDP directive applies to third country residents only if the tax treaties include an SDP clause.

As for the draft EU directive on the DST proposal, the scope is revenue related to (a) online advertising, (b) social networking services and online marketplaces, and (c) transmission of user data. Three percent of in-scope revenue will be taxed.

3.2. Nexus

Nexus is the threshold for taxation in market countries. In the OECD, if revenue in a jurisdiction is at least EUR 1 million, a nexus is deemed to exist. For the jurisdictions whose Gross Domestic Product is less than EUR 40 billion, the amount of the nexus of EUR million is replaced with EUR 250 thousand.

In the draft EU directive on the SDP proposal, in order to be allowed to tax through the SDP, (a) revenue exceeds EUR 7 million, (b) the number of users exceeds 100,000, or (c) the number of business contracts exceeds 3,000.

On the other hand, under the DST draft directive, a nexus would need to meet both requirements: (a) worldwide revenues exceed EUR 750 million and (b) taxable revenues within the EU exceed EUR 50 million.

3.3. Revenue Sourcing

A revenue sourcing rule is a rule to identify where taxation will take place under the new system. In the OECD proposal, revenue sourcing is basically determined by “the end market jurisdictions where goods or services are used or S. 144consumed”. On 4 February 2022, the OECD released detailed revenue sourcing rules. These detailed rules will classify the revenues into seven categories and apply separate revenue sourcing rules to each category. This complexity of revenue sourcing rules is a consequence of the fact that the scope of the rules is not limited to digital services and consumer products but covers all products.

The SDP and DST directives stipulate that the location will be determined based on IP addresses or, if more accurate, any other method of geolocation. The rules for revenue sourcing are relatively simple because the subject of taxation is limited to digital-related items such as IP addresses and geolocations.

3.4. Implementation

The OECD proposes that each state would require ratification of a multilateral convention. Consequently, even among the countries that have agreed politically to the OECD’s Statement on a Two-Pillar Solution in October 2021, the legal effects of Pillar 1 will not occur unless the multilateral convention (MLC) can actually be approved in the internal procedures of each country and ratified.

In the EU, a directive shall be binding upon each Member State. The legislation of “the choice of form and methods” is left to each country's domestic procedures.

3.5. Eliminating Double Taxation

The OECD’s framework suggests that double taxation of profit allocated to market jurisdictions will be relieved using either the exemption or credit method.

S. 145As for the EU SDP directive, a PE is considered to exist when there is a significant digital presence. If there is a PE in another jurisdiction, credit or exemption methods will be allowed under the bilateral double tax treaty assuming that bilateral treaties are amended.

The DST proposal does not clearly mention the double tax elimination measures. It only says, “it is expected that Member States will allow businesses to deduct the DST”. In addition, the DST is a tax imposed directly on sales and, for companies with low profit margins, it can be more burdensome than taxes on profits. The fact that the tax burden can be very high for such companies and the ambiguous treatment of the elimination of double taxation may have been one of the reasons why the EU's DST proposal failed to attract broad support.

3.6. Dispute Prevention and Resolution

Under the OECD proposal, MNEs subject to Amount A (a new taxing right for market jurisdictions) can benefit from the dispute prevention and resolution mechanisms. All issues related to Amount A, including disputes over transfer pricing and the treatment of business interests, would be addressed under these mechanisms. Within an MLC, these mechanisms will be structured in a mandatory and binding manner. An elective binding dispute resolution mechanism will be available only for issues related to Amount A for some developing economies. According to the blueprint, dispute prevention and resolution are detailed in Chapter 9, “Tax Certainty”: “The Blueprint breaks down the tax certainty dimension of Pillar One into two segments: dispute prevention and resolution for Amount A; and dispute prevention and resolution beyond Amount A.” With respect to dispute prevention and resolution of Amount A, “a representative panel mechanism” is formulated. The representative panel would “carry on a review S. 146function and involve both a review panel and, where necessary, a determination panel”. Members of the review panel consist of the “lead tax administration” to which an MNE files a tax return of Amount A, “2–3 tax administrations from other jurisdictions that provide relief for Amount A”, and “3–4 tax administrations from jurisdictions that receive an allocation of Amount A, ensuring that at least one small economy and one developing economy are included”. Members of the determination panel are not clearly defined because members of the inclusive framework “hold different views”. If an MNE accepts the outcomes of the tax certainty process, “these outcomes would be binding on the MNE and tax administrations in all jurisdictions affected by the calculation and allocation of Amount A, including jurisdictions that did not participate directly on the relevant panel”.

As for dispute prevention and resolution beyond Amount A, the OECD admits, “Inclusive Framework members continue to have different views on the scope of application of a new mandatory and binding dispute resolution mechanism beyond Amount A” and examines the following four situations. (a) For in-scope taxpayers of Amount A, “a new mandatory and binding resolution process for all disputes related to transfer pricing and permanent establishment adjustments to any of their constituent entities” is contemplated; (b) For other taxpayers outside the Amount A scope, two approaches are explored: “a mandatory binding dispute resolution process and a mandatory but nonbinding dispute resolution process coupled with aspects of peer review and statistical reporting”; (c) For Amount B (a fixed return for certain baseline marketing and distribution activities taking place physically in a market jurisdiction), any disputes related to the S. 147application of Amount B “would also be subject to mandatory binding dispute resolution”; and (d) For developing economies with no or low levels of mutual agreement procedure (MAP) disputes, it would “seem disproportionate” to require developing countries “to commit to and implement a potentially complex mandatory binding dispute resolution process”. Instead, “these jurisdictions would commit to an elective binding dispute resolution mechanism that would be triggered” when both competent authorities agree to resolve unresolved MAP issues.

On the other hand, there is no special dispute prevention or resolution provision in the draft directive for SDPs and DSTs. Disputes over these provisions are likely to be left to the interpretation of national courts and the ECJ. Additionally, the EU passed the dispute resolution directive in 2017. Compared to the EU arbitration convention, the dispute resolution directive “can be distinguished in several major aspects”. As the dispute resolution directive stipulates that it applies to “the elimination of double taxation of income and, where applicable, capital”, taxation based on significant digital presence will be applicable to the mechanism under the dispute resolution directive because a tax on significant digital presence is a corporate tax.

S. 1484. Critical analysis – Can the OECD proposal on Pillar 1 achieve equality?

4.1. Principles supporting just allocation of Pillar 1

This chapter evaluates and critically examines the OECD’s Pillar 1 proposal from an equity perspective. The Pillar 1 proposal is a response to the tax challenges of the digitalization of the economy, but it also redefines the international tax system by allocating taxing rights to market jurisdictions. It could be argued that whether the allocation to market countries is equitable is closely related to the legitimacy and stability of the system itself.

It is not easy to define what is a just allocation. There can be many different views on international tax principles related to fairness, and it is hard to universally define one position as being just and adequate.

As a clue, Hongler lists the following as guiding principles of international tax policy that are often referred to in policy debates: The principle of inter-nation equity, the principle of neutrality or efficiency, the benefit principle, the source principle, and the ability-to-pay principle.

S. 149From the trajectory of the OECD’s discussion outlined in Section 2, it seems that the OECD was thinking of setting up a new regime based on the source principle. The source principle is understood as “requiring taxation where value is created”. This value creation criterion is the underlying concept that has been the foundation of the BEPS Project. Additionally, in the course of discussion of the OECD on tax challenges of the digitalization of the economy, the OECD has repeatedly emphasized the close relationship with value creation in market countries. For example, the BEPS Action 1 final report and Tax Challenges Arising from Digitalisation – Interim Report 2018 use the same expression to refer to value creation. In February 2019, in the public consultation document “Addressing the Tax Challenges of the Digitalisation of the Economy”, there was an argument for allocating taxation rights to market countries based on the premise that value is created in market jurisdictions and presented three ideas: user participation, marketing intangible, and significant economic presence. User participation is based on the idea that, for some highly digitalized businesses, obtaining users' sustained engagement and active participation is “a critical component of value creation”. For the user participation proposal of the OECD, social media platforms, search engines, and online marketplaces are in scope. This user participation proposal “acknowledges the difficulties” using traditional transfer pricing methods. Instead, “a non-routine or residual profit split approach” is proposed for calculating the profit allocated to a user jurisdiction.

S. 150A marketing intangible is to tax based on the intangibles related to marketing activities. The marketing intangibles include brands and trade names as well as customer data, customer relationships, and customer lists. The marketing intangible proposal “would modify current transfer pricing and treaty rules” and “considers that the market jurisdiction would be entitled to tax some or all of the non-routine income properly associated with such intangibles and their attendant risk”. Significant economic presence is the idea to tax based on “a purposeful and sustained interaction with the jurisdiction via digital technology and other automated means”. Specifically, one or more of the following activities are considered to create a significant economic presence: “(1) the existence of a user base and the associated data input; (2) the volume of digital content derived from the jurisdiction; (3) billing and collection in local currency or with a local form of payment; (4) the maintenance of a website in a local language; (5) responsibility for the final delivery of goods to customers or the provision by the enterprise of other support services such as after-sales service or repairs and maintenance; or (6) sustained marketing and sales promotion activities, either online or otherwise, to attract customers”. For the significant economic presence proposal of the OECD, the allocation of income is determined by a fractional apportionment method. A fractional apportion method consists of the following three steps: (1) the definition of the tax base to be divided, (2) the determination of the allocation keys to divide that tax base, and (3) the weighting of these allocation keys.

In the public consultation document “Addressing the Tax Challenges of the Digitalisation of the Economy” of the OECD in February 2019, the system was designed based on the source principle in that value is created in the market jurisdiction and taxing rights are allocated to the market jurisdiction for that value. Additionally, the source principle (or value creation) was consistently the basis for the S. 151Programme of Work in May 2019 and the discussion draft for the Unified Approach in October 2019. The blueprint in October 2020 presents the detailed design of the new tax regime. Under the blueprint, consumer-facing businesses and automated digital services are in the scope. Consumer-facing businesses are in scope because a greater amount of targeted marketing and branding activities and the collection and exploitation of individual consumer data in market jurisdictions can “create value for consumer-facing MNEs”. Moreover, “a commensurate share assigned to the market jurisdiction” must be allowed.

On the other hand, the general definition of automated digital services is built on two elements: “automated, i.e. once the system is set up the provision of the service to a particular user requires minimal human involvement on the part of the service provider; and digital, i.e. provided over the internet or an electronic network”. Additionally, the businesses included in the following positive list are treated as automated digital services: Online advertising services, sale or other alienation of user data, online search engines, social media platforms, online intermediation platforms, digital content services, online gaming, standardised online teaching services, and cloud computing services. These in-scope businesses are also premised on the source principle's view in that, if user-participation or marketing and promoting activities are conducted in market jurisdictions, value is created there.

However, it seems that the concept of taxation based on this source principle has been transformed in the course of the OECD discussions. The Statement in October 2021, which is premised on the US proposal, turns to the concept of taxS. 152ing a portion of excess profits above a certain profitability ratio. In other words, the Statement will tax a portion of excess profits without questioning whether value is being created in the market jurisdictions. Under this system, profits will be uniformly allocated to market countries even for business activities such as the steel industry or other traditional B-to-B businesses that have little connection with marketing and other activities and are not considered to be creating value in the market jurisdictions. Therefore, the OECD’s Statement in October 2021 deviates from the source principle which is the idea of taxing where value is created. In addition, there are many critics who argue that the concept of value creation itself is not suitable as a taxing principle.

Some try to search for the link to other principles. Eva Escribano López articulates that “benefit principle may be regarded as the hidden dogma” of the current international tax reform in the OECD and the EU. The justification of the taxation based on the benefit principle is that taxpayers are “in a position to effectively or potentially benefit from the relevant public goods, services and infrastructures provided by the State concerned”. It then states that tax rules based on this benefit principle should “merely rely on a presumption of access to benefits rather than on the case-by-case demonstration of the effective use and enjoyment of the State's public services”. Moreover, Louise Fjord Kjærsgaard states that “the allocation should continue to be justified by the principle of economic allegiance in accordance with the ability of the MNEs to pay taxes”. According to Louise Fjord Kjærsgaard, this “economic allegiance” is shown in the Report on Double Taxation on 5 April 1923 by the four economists appointed by the League S. 153of Nations. Additionally, referring to the description in this report, the author states that the ability-to-pay principle is “widely endorsed in contemporary doctrine”. However, these ideas of searching for other principles still seem to assume situations in which value is created from activities conducted by digital businesses in market jurisdictions. They do not fully provide enough reasons why even forms such as the steel industry or other traditional B-to-B businesses that are not fully active have little connection with marketing and other activities and do not create much value in market countries should be subject to the new allocation rules set forth in the Statement. There is also a problem with accepting the ability-to-pay principle as a principle of international taxation. Thus, the fact that the principles that support the new tax system allocating the taxing right to market jurisdictions, such as value creation and source principles, have been somewhat shaken could lead to the possibility that political agreements in the OECD could “turn out to be a rather superficial and makeshift compromise.” This could also make the application of new rules difficult for both scholars and practitioners.

S. 1544.2. Developing countries’ reactions to the OECD proposal on Pillar 1

Some developing countries have voiced concerns about whether the OECD proposals will harm their interests. Kenya, Nigeria, Pakistan, and Sri Lanka, despite having participated in the discussions of the Inclusive Framework, have not yet agreed to join the Pillar 1 framework. The Group of 24 (G24), the emerging and developing countries of Africa, Asia, and Latin America have suggested that the allocation of residual profits in market countries should be at least 30 percent. The African Tax Administration Forum (ATAF), an association of African taxing authorities, also says that the distribution of profits to market jurisdictions in the blueprint is not “adequate and needs to be increased”. In addition, NGOs and some academics have expressed their opinions on the side of developing countries. For example, the BEPS monitoring group has stated that the nexus threshold in the Statement for Pillar 1 is so high that smaller and low-income countries will hardly benefit from it.

In fact, according to the impact assessment of the OECD on both pillars, the amount redistributed in Pillar 1 is much smaller than that in Pillar 2. In Amount A, 25 percent of residual profit defined as profit in excess of 10 percent of revenue will be allocated. This 25 percent figure seemed to be politically decided in the final stage of the discussion in the Inclusive Framework. From the standpoint that distributive justice is achieved by increasing the amount of allocation, the Pillar 1 agreement may seem insufficient. However, the figure itself is S. 155not conclusive. It is clearly stated in the Statement that the system will be reviewed after seven years.

4.3. Pillar 1 as a possible foundation for formulary apportionment

According to some scholars, the reallocation of taxing rights in Amount A, in the blueprint in 2020, and the Statement in 2021 is sometimes regarded as a global formulary apportionment. The definition of formulary apportionment or formulary system would be that “the consolidated income of a multinational group would be allocated among various jurisdictions based on certain parameters, such as revenues, employees, or assets in a certain state”. Some countries such as the United States and Switzerland use the formulary apportionment to allocate income within their states. Some scholars claim that a global formulary apportionment can achieve allocation that is more just.

However, currently, the OECD does not officially seem to endorse the global formulary apportionment as a method for allocating taxable income. The OECD’s S. 156views on formulary apportionment are detailed in the OECD Transfer Pricing guidelines. The OECD mentioned that one of the problems with formulary apportionment is “the difficulty of implementing the system in a manner that both protects against double taxation and ensures single taxation”. To avoid double taxation, there needs to be a common agreement on the global tax base, the use of a common accounting system, and the allocation factor. These conditions of the common agreement seem to be met by Pillar 1 but, at this stage, the OECD does not mention the progress of Pillar 1 in the formulary apportionment section of the transfer pricing guidelines.

4.4. Tax certainty for just allocation

Many people focus on the rate and method of distribution when just allocation is discussed but, in this article, it is argued that the major advancement in Pillar 1 is currently to secure or try to secure tax certainty rather than the allocation itself. As explained in Chapter 3.6 above, the OECD’s dispute prevention and resolution procedures are not limited to the allocation of Amount A but also include disputes over transfer pricing and the treatment of business interests. These S. 157procedures would provide taxpayers with access to appropriate remedies and improve the predictability of tax disputes.

Tax certainty is also related to the issue of justice. As stated in the Ottawa Taxation Framework, which was the beginning of the consideration of digital taxation, certainty and simplicity can be considered the principle in taxation. The profits allocated in Pillar 1 are not large, and Pillar 1 may not be satisfactory to all commentators from the perspective of achieving distributive justice. However, it could be a step forward in terms of confirming procedural justice for taxpayers in the international tax dispute.

Additionally, it is worth noting that, from the OECD’s perspective, a major obstacle to adopting formulary apportionment has been the absence of an effective dispute prevention and resolution mechanism (See Chapter 4.3. above). However, if this Pillar 1’s dispute prevention and resolution mechanism work effectively, this obstacle will be eliminated, and the OECD will be in a position to directly adopt a formulary apportionment. In other words, the OECD’s proposal on Pillar 1 can be a big step forward in preparing the preconditions for realizing a full scale formulary apportionment that can achieve allocation that is more just through securing the procedural justice.

4.5. Other implementation issues

In addition to the justice issues mentioned above, Pillar 1 also has some practical issues to overcome. In particular, to ensure simplicity, it is necessary to carefully consider the following points; the revenue sourcing rule and Amount B.

Revenue sourcing is an important component of Pillar 1 that underpins the source principle (although the link between Pillar 1 and the source principle weakens, as mentioned in Chapter 4.1.). It is necessary to construct appropriate rules while balancing certainty and simplicity.

According to the Statement in October 2021, Amount B is expected to be finalized by the end of 2022. Given that the signing of the MLC is scheduled to begin S. 158in mid-2022, it is likely that the contents of Amount B will not be included in the MLC as of mid-2022. However, the OECD has not provided a clear plan on how to uniformly implement Amount B in each country without a multilateral convention. There are great expectations for this “Amount B” from emerging and developing countries. It would be necessary for the OECD to present an early outlook on Amount B.

5. Conclusion

The OECD’s political agreement in October 2021 has been touted as a historic agreement, but whether this agreement will be historic depends on the future implementation. Pillar 1’s complexity and deviations from the source principle could undermine the potential of the new tax system. Addressing the concerns of emerging and developing countries will also be necessary from the perspective of ensuring the implementation of the agreement. In addition, while the OECD’s political agreement may potentially serve as a basis for a formulary apportionment, the key to stabilizing the system is to ensure sufficient procedural justice through the dispute prevention and resolution mechanism in the tax certainty process. In any case, since the OECD agreement calls for a review in seven years, many of the points raised will probably become topics for discussion again at that time.