The Organisation for Economic Co-operation and Development (OECD) today released a report addressing the role of developing countries with respect to the base erosion and profit shifting (BEPS) project.
As noted in today’s OECD release [PDF 259 KB], the BEPS project is intended to address tax planning strategies that exploit gaps and mismatches in tax rules that, in turn, allow for profits to be artificially shifted to low or no-tax locations where there is little or no economic activity—with the result that little or no overall corporate tax is paid. BEPS is of major significance for developing countries due to their heavy reliance on corporate income tax, particularly from multinational enterprises (MNEs).
The OECD noted that over 80 developing countries and other non-OECD / non-G20 economies have been consulted at in-depth regional consultations and global sessions that were attended by more than 110 jurisdictions as well as representatives from civil society and the business community.
A related OECD release notes certain elements under the current strategy for developing countries:
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