The Organisation for Economic Cooperation and Development (OECD) today released a draft practice note that is intended to help developing countries address base erosion and profit shifting (BEPS) challenges in raising revenue from the mining sectors.
As noted in the OECD release, mineral resources can present an unparalleled economic opportunity for developing countries to increase government revenue. Tax base erosion and profit shifting, combined with gaps in the capabilities of tax authorities in developing countries, threaten this prospect. One area that multinational enterprises use to shift profits is claiming excessive interest deductions. The draft practice note is intended to help guide tax officials on how to address these BEPS attempts.
Comments on the draft practice note are due by 18 May 2018.
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