OECD Inclusive Framework advances digitalisation and cross-border worker tax work

Digitalisation work remains exploratory

Members agreed to build a common understanding of the perceived challenges and how they relate to existing international tax rules, with the stated aim of preserving certainty, stability and durability. The plenary also reviewed implementation of the Global Minimum Tax, including the Side-by-Side package, but the announcement does not adopt further GloBE rules or announce a new commencement date.^[1]

Cross-border workers create personal and corporate questions

The worker-mobility project addresses the tax consequences of employees and other workers operating across borders or remotely. The OECD’s preceding consultation identified employment-income residence and taxing-right questions, possible dual filing and employer withholding or registration obligations, and interaction with social-security systems. It also identified corporate issues where an employee’s presence could create a permanent establishment or affect corporate residence, profit attribution and transfer pricing.^[2]

Those issues engage existing domestic law and bilateral treaties rather than a new operative instrument. The consultation points to Articles 4 and 15 of the OECD Model Tax Convention for residence and employment income, and to Article 5 and its 2025 Commentary for fixed-place permanent establishments. It also identifies dependent-agent and services permanent establishments, attribution of profits by functions, assets and risks, and arm’s-length pricing where mobile employees work for or benefit associated enterprises in different jurisdictions.^[2]

No operative rule yet

The 30 October decision is a policy and work-programme milestone, not an amendment to the OECD Model, a multilateral convention or any jurisdiction’s law. It contains no draft rule, threshold, safe harbour, filing deadline or effective date. Existing domestic registration, payroll withholding, return and treaty obligations continue to apply on their present terms.^[1][2]

MNE groups with remote workers, cross-border commuters, international secondments, mobile senior management or dispersed group functions should continue mapping where duties are performed, who bears remuneration and which entity benefits from the work. They should monitor the OECD’s next outputs for permanent-establishment, residence, profit-attribution, transfer-pricing, employment-income and employer-compliance proposals. Groups within Pillar Two should separately monitor Global Minimum Tax implementation; the plenary review does not itself alter current GloBE calculations or returns.^[1][2]