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The Tax Foundation is the nation’s leading independent tax policy nonprofit. Since 1937, our principled research, insightful analysis, and engaged experts have informed smarter tax policy at the federal, state, and global levels. For over 80 years, our goal has remained the same: to improve lives through tax policies that lead to greater economic growth and opportunity.
The OECD and other multilateral forums are exploring options to resolve the current debate over policies that would adjust which countries can tax what share of income from multinational corporations. Just as the policy changes from the Base Erosion and Profit Shifting (BEPS) project in 2015 created different incentives for business investment by multinational corporations and the design of their supply chains, this new debate will also change those incentives.
The impact of these policies should be taken into consideration by policymakers when determining whether additional measures should be adopted to further minimize policy gaps and opportunities for tax planning. Taxes matter for decisions to be made by businesses, individuals, and families, and it is important for policymakers to understand that rules can be designed to be neutral rather than distortionary.
The posts below review the evidence that has been gathered on the impact of policies targeted at profit shifting.
Stay Updated on Tax Issues Around the World
Addressing tax avoidance is a key political issue for many countries, but these policies should not be discussed without accounting for the size of the current problem, how recent policy changes have addressed it, and what potential impacts might come from this new approach.
Kenneth Klassen is the Deloitte Professor and Director of the Waterloo Centre for Taxation in a Global Economy at the University of Waterloo.
Victoria Perry is Assistant Director in the Fiscal Affairs Department and Division Chief of the Tax Policy Division at the International Monetary Fund.
Pascal Saint-Amans is Director of the OECD’s Centre for Tax Policy and Administration (CPTA).
Dhammika Dharmapala is a Professor of Law at the University of Chicago Law School.
Kimberly Clausing is the Thormund A. Miller and Walter Mintz Professor of Economics at Reed College.