G20 Foundation Publications Australia 2014 | Page 42

Restoring integrity of tax systems – a taxing crossroad

Restoring integrity of tax systems - a taxing crossroad

It may be argued that the OECD Action Plan on Base Erosion and Profit Shifting ( BEPS ) has two main complementary objectives :
The first main objective is the elimination of international tax avoidance and evasion schemes ( specifically those labelled as “ aggressive ”) that thrive on identifying and exploiting the legal opportunities available to multinational enterprises . This objective , apart from its multilateral scale and scope , is not completely new . Countries have always been quick to close tax loopholes whenever they have been identified , just as tax advisers and taxpayers have been quick at identifying and exploiting them . The second main objective of the Action Plan on BEPS is to restore integrity in tax systems . According to the Action Plan , base erosion and profit shifting undermines the integrity of the tax system because “ the public , the media and some taxpayers deem reported low corporate taxes to be unfair ”.
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