OECD vows to ‘change the game’ with new tax rules

PARIS, Sept 16 (AFP) : The OECD on Tuesday put forward new proposals it said would "change the rules of the game" for companies which avoid paying huge amounts of tax by exploiting international loopholes.
Pascal Saint-Amans, head of tax at the OECD, said that 44 countries representing 90 per cent of the world economy had agreed on the need to stop companies taking advantage of different regimes by means of what are known as tax optimisation strategies.
Many of these strategies are legal, but are sometimes at the limit of the law.
The seven items of the action plan will "change the rules of the game" to ensure companies pay taxes where they make their profits, he told journalists at the offices of the Organisation for Economic Cooperation and Development in Paris.
The basic principle behind the proposals is that tax should be paid in the country where it is generated, and to prevent international tax agreements intended to avoid double-taxation from being used to obtain double-tax deductions.
Corporate tax avoidance, particularly by some multinational groups, has become a political hot potato since the financial crisis.
Governments struggling to cope with budget deficits have sought to close legal tax loopholes for businesses.