UK leads efforts to clampdown on tax avoidanceStaff writer ▼ | October 12, 2015
Multinationals looking to shift profits to avoid paying their fair share of tax will find it harder to avoid tax, the Chancellor George Osborne announced.
Taxes Chancellor George Osborne announced:
The recommendations are the culmination of a major and unparalleled international effort to tackle tax avoidance by multinationals.
Since 2012, when the Chancellor put tax avoidance on the G20 agenda, the UK has helped reform international tax rules and led the way with action to prevent corporations from paying little or no taxes. This includes:
Being the first country to take steps to introduce the country-by-country reporting template for multinationals. It will mean multinational companies have to provide HMRC with information on where they pay taxes and earn profits around the world [Winter 2014]
Being the first country to take steps to stop multinationals from exploiting the difference between countries’ tax rules to avoid paying tax through new ‘hybrid mismatch’ rules [Winter 2014]
Making it harder for multinational companies to divert their profits out of the UK through introducing the Diverted Profits Tax which ensures multinationals pay tax in the UK when economic activity has taken place in the UK
Helping developing countries, like Ghana, tackle tax avoidance by working with them to improve their tax rules and infrastructure
Working in the EU to agree a process for tax authorities to exchange information on the tax affairs of multinational companies to improve transparency. ■