Diverted Profit Tax Swings for the Fences: Australia Officially Join the UK; Other Spots Available…
We had the opportunity to blog recently on the UK diverted tax profit here.
On April 19, 2015, Australia “announced during the course of the G20 meeting the urgent establishment of a joint working group to further consider and develop initiatives in relation to diverted profits by multinational enterprises.”
According to the communiqué:
“The Ministers have resolved, subject to the completion of the UK general election, to establish a senior officials working group that will develop measures to address the diversion of profits by multinational enterprises away from their host countries.
Both the UK and Australia have sought to put in place competitive business tax regimes in order to encourage enterprise and investment, but those tax rates should be paid, not avoided through artificial structures.
The working group will build on the UK’s experience of introducing a Diverted Profits Tax, which came into effect at the beginning of April.
This is a global issue that needs to be quickly addressed, and as such the working group will be open to all G20 members.
Any working group initiatives will be consistent with the work of the OECD on Base Erosion and Profit Shifting, and other international initiatives such as the Automatic Exchange of Information and Tax Inspectors Without Borders.”
See the complete release here.
This unilateral tax goes directly against the “multilateral efforts” put forward by the OECD Base Erosion and profit Shifting (BEPS) initiative; thus the “need” to convert it to a “multilateral” industrialized-based country initiative… “What the BEPS?”, might we say…
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