Companies face a big increase in their tax bills under a “once-in-a-generation” change to tax avoidance rules.
The Organisation for Economic Co-operation and Development announced guidelines yesterday to equip the global tax system for the digital world and to crack down on companies such as Google, Starbucks and Amazon that have been accused of abusing tax loopholes.
The proposals are the culmination of three years’ work to update an out-of-date rulebook that the OECD claimed was costing governments as much as $240 billion each year in lost corporation tax revenues.
Among the proposals is a global standard on the deductibility of interest payments from profits before tax. The OECD has recommended capping the limit at 30 per cent of operating profits, in line with German