How to tax multinationals

KEY POINTS

• Focus of the UK government is create a competitive tax system that is fair and provides certainty.
• Problems associated with the digital global economy.
• Profit-based tax recognises net value.
• Tax rules should be simple to follow.

The complexities in taxing multinationals has risen to prominence again since the Organisation for Economic Co-operation and Development (OECD) re-opened the debate about taxing the digitalised economy. The Paradise Papers also instigated another round of scrutiny on the international tax system. It was timely therefore that the panel at the Women in Tax’s third annual debate on 20 November at Pinsent Masons in London grappled with the issue ‘how to tax multinationals’.

Perhaps the reason this conundrum remains unresolved despite an extensive global conversation through the OECD base erosion and profit shifting project (BEPS)...