India signed the OECD (Organisation for Economic Co-operation and Development) multilateral convention that aims to check cross-border tax evasion by multinational companies. Union Finance Minister Arun Jaitley signed the multilateral convention in Paris, France to implement tax treaty- related measures to prevent base erosion and profit shifting.
More than 65 countries, including India, signed the convention. As per the Finance Ministry, the Convention will modify India’s treaties in order to curb revenue loss through treaty abuse and base erosion and profit shifting strategies by ensuring that profits are taxed where substantive economic activities generating the profits are carried out and where the value is created.
The Multilateral Convention is an outcome of the OECD/G20 Project to tackle Base Erosion and Profit Shifting (BEPS) which is resorted to by MNCs through tax planning strategies by exploiting gaps and mismatches in tax rules.
Static Takeaways for IBPS PO Exam-
- The Organisation for European Economic Cooperation (OEEC) was established in 1948
- OECD Headquarters in Paris, France.
- Secretary-General of OECD is Angel Gurria.
Source- The Hindu Business Line