Base Erosion and Profit Shifting (BEPS)

The OECD and other multilateral forums have been 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.

Launch U.S. International Tax Resource Center

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What We Know: Reviewing the Academic Literature on Profit Shifting

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U.S. Cross-border Tax Reform and the Cautionary Tale of GILTI

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Day 2 of OECD Consultation on International Tax Reform Blueprints

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Two Roads Diverge in the OECD’s Impact Assessment

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Thin-Cap Rules in Europe

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CFC Rules in Europe

To prevent businesses from minimizing their tax liability by taking advantage of cross-country differences in taxation, countries have implemented various anti-tax avoidance measures, one known as Controlled Foreign Corporation (CFC) rules.

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