The OECD and Digital Services Taxes

The digital economy has grown two and a half times faster than the global GDP over the last 15 years, fundamentally changing how businesses operate in foreign markets. International tax codes haven’t kept pace with its rapid expansion until recently.

Many multinational corporations don’t have a physical presence in countries where they conduct business. Consequently, some companies have avoided paying taxes using base erosion and profit sharing (BEPS) strategies, which exploit gaps and mismatches in tax rules among different countries. BEPS corporate tax planning strategies are harmful for countries, especially developing countries, that rely on corporate income tax.

The Organisation for Economic Co-Operation and Development (OECD) has been working with governments, policymakers, and citizens around the globe to standardize international taxation via the OECD/G20 Inclusive Framework on Base Erosion and Profit Shifting (OECD Inclusive Framework).

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