The Use of Financial Accounting Information in the OECD BEPS 2.0 Project: A Discussion of the Rules and Concerns

Forthcoming, National Tax Journal

MIT Sloan Research Paper No. 6888-23

53 Pages Posted: 9 Jan 2023 Last revised: 17 May 2023

See all articles by Michelle Hanlon

Michelle Hanlon

Massachusetts Institute of Technology (MIT) - Sloan School of Management

Michelle L. Nessa

Michigan State University - The Eli Broad College of Business and The Eli Broad Graduate School of Management

Date Written: October 25, 2022

Abstract

This paper discusses the Organization for Economic Cooperation and Development’s Two- Pillar proposal for changing the global, international corporate tax regime. We focus on the use of financial accounting income as part of these tax rules. We provide a relatively high-level explanation of the rules, and we discuss some inconsistencies and complexities. We also discuss potential problems and unintended consequences for companies, financial statement users, tax authorities, financial statement auditors, and financial accounting standard setters as a result of using financial accounting income in the tax base.

Keywords: International taxation, financial accounting, Pillar 2, Pillar 1

JEL Classification: H25, M41

Suggested Citation

Hanlon, Michelle and Nessa, Michelle L., The Use of Financial Accounting Information in the OECD BEPS 2.0 Project: A Discussion of the Rules and Concerns (October 25, 2022). Forthcoming, National Tax Journal, MIT Sloan Research Paper No. 6888-23, Available at SSRN: https://ssrn.com/abstract=4319352

Michelle Hanlon

Massachusetts Institute of Technology (MIT) - Sloan School of Management ( email )

100 Main Street
E62-668
Cambridge, MA 02142
United States
617-253-9849 (Phone)

Michelle L. Nessa (Contact Author)

Michigan State University - The Eli Broad College of Business and The Eli Broad Graduate School of Management ( email )

East Lansing, MI 48824-1121
United States

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