2022 MAP Statistics and Awards
On today's Tax Certainty Day, the OECD Tax revealed the 2022 Mutual Agreement Procedures (MAP) Statistics and Awards.
Statistics
The latest MAP statistics cover a record 133 jurisdictions, and form part of the BEPS Action 14 Minimum Standard and the wider G20/OECD tax certainty agenda to improve the effectiveness and timeliness of tax-related dispute resolution mechanisms.
The 2022 MAP Statistics show the following trends:
Taxpayers are engaging with MAP more than ever.
The number of new MAP cases opened in 2022 increased (almost +3%) compared to 2021. This represents that MAP is back to "business as usual" for many competent authorities after a decrease in cases opened in 2021, and it is encouraging to see that taxpayers have increasing faith in MAP owing to greater availability and access, a by-product of the BEPS Action 14 Minimum Standard.
Fewer MAP cases were closed in 2022.
Approximately 4% fewer MAP cases were closed in 2022 than in 2021, which concerns both transfer pricing cases (-0.5%) and other cases (almost -6.5%) closed. While 2021 was a stellar year for case closures (up +13% from 2020) as many competent authorities prioritized simpler cases, the 2022 result was a return to baseline for MAP case closures and still represents a significant increase compared to 2020 (nearly +9%) and 2019 (+3.5%).
Outcomes remain generally positive.
Around 73% of the MAPs concluded in 2022 fully resolved the issue both for transfer pricing and other cases. Approximately 2% of MAP cases were closed with no agreement. Both of these numbers remain similar to 2021.
Average case times start to close in on the 24-month target.
On average, MAP cases closed in 2022 took 25.3 months compared to 26 months in 2021, moving one step closer to the target. In particular, transfer pricing cases took 29 months, down from 32.3 months in 2021, the first time this number has been below 30 months. These positive results show that even though taxpayers are requesting MAP more than ever, competent authorities are rising to the challenge through greater resources and better case management. While there is more work to be done, this highlights the significant investment made by jurisdictions into their competent authority functions despite the increasing strain on resources in general.
Awards
The OECD Tax also announced the winners of the Mutual Agreement Procedures (MAP) Awards, given in recognition of efforts by competent authorities. Netherlands won most improved jurisdiction!
Netherlands and New Zealand for the shortest time in closing transfer pricing cases and other cases respectively.
Canada for the smallest proportion of pre-2016 cases in end inventory.
Luxembourg and Norway for the most effective caseload management.
Netherlands for the most improved jurisdiction. Netherlands closed an additional 102 cases with positive outcomes compared to 2021 with increases for both transfer pricing and other cases.
Denmark-Ireland for the pair of jurisdictions that dealt the most effectively with their joint caseload for transfer pricing cases.
Germany-Ireland for the pair of jurisdictions that dealt the most effectively with their joint caseload for other cases.
Read more here.
