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Berlin - The Organisation for Economic Co-operation and Development (OECD), which advises its mainly rich nation members on economic and tax policies, has been charged by the G20 group of countries with formulating measures to stop big companies shifting profits into tax havens.
A draft action plan is under discussion to help western governments try to plug a range of tax loopholes used by technology giants including Apple and Amazon.
Corporate tax avoidance has become a hot political issue following public outrage over revelations that companies such as Apple and Google had used structures US and European politicians said were designed to minimise the amount of taxes paid.
The OECD is now due to present an "action plan" highlighting broad areas where changes will be discussed to a G20 meeting later this month.
A preliminary draft of the plan, dated 27 May, shows the organisation has already identified a number of specific profit shifting schemes.
"Domestic and international tax rules should be modified in order to more closely align the allocation of income with the economic activity that generates that income," the draft said, echoing comments from politicians in the United States and Europe in the past year.
Business lobby groups have questioned whether companies do engage in activities to shift profits to units in tax havens and whether there is a need for rule changes.
But as governments struggle with large deficits following the financial crisis, lawmakers have said enough is enough.
Revenues
The draft plan aims for OECD members and non-members to agree on specific changes to international tax rules in one to two years - fast by the standards of international tax diplomacy.
Among the areas the draft said the OECD would seek to address are situations where companies avoid creating a taxable residence in a market where they have major activities.
British lawmakers have accused Google of using certain arrangements to avoid creating a tax residence in the UK.
Its low tax bill is a result of channelling revenues through Ireland, from where most revenue is sent to Bermuda, with next to taxes being paid anywhere in the chain.
The action plan said the OECD would also examine the avoidance of tax residence, or permanent establishment "through the use of commissionaire arrangements" - a mechanism used by companies including Dell to avoid reporting revenues in markets where they have major sales.
Also up for possible revisions are long-standing "specific activity exemptions" which have been used by Amazon to enable it operate major retail businesses in countries like Britain and Germany without creating tax residences for these businesses.
A draft action plan is under discussion to help western governments try to plug a range of tax loopholes used by technology giants including Apple and Amazon.
Corporate tax avoidance has become a hot political issue following public outrage over revelations that companies such as Apple and Google had used structures US and European politicians said were designed to minimise the amount of taxes paid.
The OECD is now due to present an "action plan" highlighting broad areas where changes will be discussed to a G20 meeting later this month.
A preliminary draft of the plan, dated 27 May, shows the organisation has already identified a number of specific profit shifting schemes.
"Domestic and international tax rules should be modified in order to more closely align the allocation of income with the economic activity that generates that income," the draft said, echoing comments from politicians in the United States and Europe in the past year.
Business lobby groups have questioned whether companies do engage in activities to shift profits to units in tax havens and whether there is a need for rule changes.
But as governments struggle with large deficits following the financial crisis, lawmakers have said enough is enough.
Revenues
The draft plan aims for OECD members and non-members to agree on specific changes to international tax rules in one to two years - fast by the standards of international tax diplomacy.
Among the areas the draft said the OECD would seek to address are situations where companies avoid creating a taxable residence in a market where they have major activities.
British lawmakers have accused Google of using certain arrangements to avoid creating a tax residence in the UK.
Its low tax bill is a result of channelling revenues through Ireland, from where most revenue is sent to Bermuda, with next to taxes being paid anywhere in the chain.
The action plan said the OECD would also examine the avoidance of tax residence, or permanent establishment "through the use of commissionaire arrangements" - a mechanism used by companies including Dell to avoid reporting revenues in markets where they have major sales.
Also up for possible revisions are long-standing "specific activity exemptions" which have been used by Amazon to enable it operate major retail businesses in countries like Britain and Germany without creating tax residences for these businesses.
