As major corporations move from country to country to avoid high taxes, the activity saves them hundreds of billions of dollars a year. Countries in which these companies might pay taxes have so far not had much luck in improving the situation.

The Organisation for Economic Co-operation and Development (OECD) and G20 have proposed a means to get its members a better deal on taxes paid by global companies, although the plan does not have much teeth.

The OECD/G20 measurement of the tax sum that companies dodge is:

… conservatively estimated at USD 100-240 billion annually, or anywhere from 4-10% of global corporate income tax (CIT) revenues.

As a means to capture some of this:

G20 finance ministers endorsed the final package of measures for a comprehensive, coherent and co-ordinated reform of the international tax rules during a meeting on 8 October, in Lima, Peru.

During a meeting chaired by Turkish Deputy Prime Minister Cevdet Yilmaz, the G20 finance ministers expressed strong support for the OECD/G20 Base Erosion and Profit Shifting (BEPS) Project, which provides governments with solutions for closing the gaps in existing international rules that allow corporate profits to « disappear » or be artificially shifted to low/no tax environments, where little or no economic activity takes place.

They renewed a commitment for rapid, widespread and consistent implementation of the BEPS measures and reiterated the need for the OECD to prepare an inclusive monitoring framework by early-2016 in which all countries will participate on an equal footing.

A monitoring framework is nothing like laws to make corporations pay taxes in the countries in which they are headquartered or, alternatively, in countries where they produce their revenue.

The practice of holding cash earned by large countries off shore from the places they are headquartered is an old, and for many companies, successful one. In this case, talking about a problem is far from fixing it.

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