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Consider the following with regards to Base Erosion and Profit Shifting (BEPS).
BEPS refers to the phenomenon where companies invest in a host country via shell companies situated in tax havens to reduce their tax liability.
The Multilateral Convention to Implement Tax Treaty Related Measures to Prevent BEPS is an outcome of the World Economic Forum BEPS Project.
India recently ratified the Multilateral Convention to Implement Tax Treaty Related Measures to Prevent BEPS.
Select the correct answer using the codes below.
- a)1 and 2 only
- b)2 and 3 only
- c)1, 2 and 3
- d)3 only
Correct answer is option 'D'. Can you explain this answer?
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Consider the following with regards to Base Erosion and Profit Shifti...
Base Erosion and Profit Shifting (BEPS) is a term used to describe the practice where multinational companies shift their profits from high-tax jurisdictions to low-tax or tax haven jurisdictions, in order to reduce their overall tax liability. This is achieved by artificially creating structures such as shell companies in tax havens, which are used to channel profits and avoid paying taxes in the countries where the economic activities generating those profits actually take place.
The Multilateral Convention to Implement Tax Treaty Related Measures to Prevent BEPS is an international agreement developed under the auspices of the Organisation for Economic Co-operation and Development (OECD) as part of its BEPS Project. The BEPS Project was initiated to address the concerns regarding the erosion of tax bases and the shifting of profits by multinational companies. The project aimed to develop measures to prevent these practices and ensure that profits are taxed in the countries where economic activities generating those profits actually take place.
India, being one of the countries heavily impacted by BEPS, has taken steps to address this issue. In order to prevent base erosion and profit shifting, India ratified the Multilateral Convention to Implement Tax Treaty Related Measures to Prevent BEPS. By ratifying this convention, India has committed to implementing the measures developed under the BEPS Project and modifying its existing tax treaties to incorporate these measures.
The ratification of the Multilateral Convention by India is a significant step towards preventing BEPS and ensuring that multinational companies pay their fair share of taxes in India. It demonstrates India's commitment to international efforts to combat tax avoidance and promote a more equitable global tax system.
In conclusion, BEPS refers to the practice of multinational companies shifting their profits to tax havens to reduce their tax liability. The Multilateral Convention to Implement Tax Treaty Related Measures to Prevent BEPS is an outcome of the World Economic Forum BEPS Project, and India has recently ratified this convention to address the issue of BEPS.
The Multilateral Convention to Implement Tax Treaty Related Measures to Prevent BEPS is an international agreement developed under the auspices of the Organisation for Economic Co-operation and Development (OECD) as part of its BEPS Project. The BEPS Project was initiated to address the concerns regarding the erosion of tax bases and the shifting of profits by multinational companies. The project aimed to develop measures to prevent these practices and ensure that profits are taxed in the countries where economic activities generating those profits actually take place.
India, being one of the countries heavily impacted by BEPS, has taken steps to address this issue. In order to prevent base erosion and profit shifting, India ratified the Multilateral Convention to Implement Tax Treaty Related Measures to Prevent BEPS. By ratifying this convention, India has committed to implementing the measures developed under the BEPS Project and modifying its existing tax treaties to incorporate these measures.
The ratification of the Multilateral Convention by India is a significant step towards preventing BEPS and ensuring that multinational companies pay their fair share of taxes in India. It demonstrates India's commitment to international efforts to combat tax avoidance and promote a more equitable global tax system.
In conclusion, BEPS refers to the practice of multinational companies shifting their profits to tax havens to reduce their tax liability. The Multilateral Convention to Implement Tax Treaty Related Measures to Prevent BEPS is an outcome of the World Economic Forum BEPS Project, and India has recently ratified this convention to address the issue of BEPS.
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Consider the following with regards to Base Erosion and Profit Shifti...
Justification: Statement 1: Base erosion and profit shifting refers to the phenomenon where companies shift their profits to other tax jurisdictions, which usually have lower rates, thereby eroding the tax base in India. The companies need not invest via shell companies to be accused of BEPS.
Statement 2 and 3: India in July 2019 ratified the international agreement to curb base erosion and profits shifting (BEPS)– Multilateral Convention to Implement Tax Treaty Related Measures.
The Convention is an outcome of the OECD / G20 BEPS Project to tackle base erosion and profit shifting through tax planning strategies that exploit gaps and mismatches in tax rules to artificially shift profits to low or no-tax locations where there is little or no economic activity, resulting in little or no overall corporate tax being paid.
Learning: Under BEPS Action 13, all large multinational enterprises (MNEs) are required to prepare a country-by-country (CbC) report with aggregate data on the global allocation of income, profit, taxes paid and economic activity among tax jurisdictions in which it operates. This CbC report is shared with tax administrations in these jurisdictions, for use in high level transfer pricing and BEPS risk assessments.
The Base Erosion and Profit Shifting (BEPS) Action 13 report (Transfer Pricing Documentation and Country-by-Country Reporting) provides a template for multinational enterprises (MNEs) to report annually and for each tax jurisdiction in which they do business the information set out therein. This report is called the Country-by-Country (CbC) Report.
What CBC contains?Aggregated country-by-country information relating to the global allocation of income, the taxes paid, and certain other indicators of a multi-national company.
A list of all the constituent entities of the multi-national company operating in a particular jurisdiction and the nature of the main business activity of each constituent entity.
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Consider the following with regards to Base Erosion and Profit Shifting (BEPS). BEPS refers to the phenomenon where companies invest in a host country via shell companies situated in tax havens to reduce their tax liability. The Multilateral Convention to Implement Tax Treaty Related Measures to Prevent BEPS is an outcome of the World Economic Forum BEPS Project. India recently ratified the Multilateral Convention to Implement Tax Treaty Related Measures to Prevent BEPS. Select the correct answer using the codes below.a)1 and 2 onlyb)2 and 3 onlyc)1, 2 and 3d)3 onlyCorrect answer is option 'D'. Can you explain this answer?
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Consider the following with regards to Base Erosion and Profit Shifting (BEPS). BEPS refers to the phenomenon where companies invest in a host country via shell companies situated in tax havens to reduce their tax liability. The Multilateral Convention to Implement Tax Treaty Related Measures to Prevent BEPS is an outcome of the World Economic Forum BEPS Project. India recently ratified the Multilateral Convention to Implement Tax Treaty Related Measures to Prevent BEPS. Select the correct answer using the codes below.a)1 and 2 onlyb)2 and 3 onlyc)1, 2 and 3d)3 onlyCorrect answer is option 'D'. Can you explain this answer? for UPSC 2024 is part of UPSC preparation. The Question and answers have been prepared according to the UPSC exam syllabus. Information about Consider the following with regards to Base Erosion and Profit Shifting (BEPS). BEPS refers to the phenomenon where companies invest in a host country via shell companies situated in tax havens to reduce their tax liability. The Multilateral Convention to Implement Tax Treaty Related Measures to Prevent BEPS is an outcome of the World Economic Forum BEPS Project. India recently ratified the Multilateral Convention to Implement Tax Treaty Related Measures to Prevent BEPS. Select the correct answer using the codes below.a)1 and 2 onlyb)2 and 3 onlyc)1, 2 and 3d)3 onlyCorrect answer is option 'D'. Can you explain this answer? covers all topics & solutions for UPSC 2024 Exam. Find important definitions, questions, meanings, examples, exercises and tests below for Consider the following with regards to Base Erosion and Profit Shifting (BEPS). BEPS refers to the phenomenon where companies invest in a host country via shell companies situated in tax havens to reduce their tax liability. The Multilateral Convention to Implement Tax Treaty Related Measures to Prevent BEPS is an outcome of the World Economic Forum BEPS Project. India recently ratified the Multilateral Convention to Implement Tax Treaty Related Measures to Prevent BEPS. Select the correct answer using the codes below.a)1 and 2 onlyb)2 and 3 onlyc)1, 2 and 3d)3 onlyCorrect answer is option 'D'. Can you explain this answer?.
Consider the following with regards to Base Erosion and Profit Shifting (BEPS). BEPS refers to the phenomenon where companies invest in a host country via shell companies situated in tax havens to reduce their tax liability. The Multilateral Convention to Implement Tax Treaty Related Measures to Prevent BEPS is an outcome of the World Economic Forum BEPS Project. India recently ratified the Multilateral Convention to Implement Tax Treaty Related Measures to Prevent BEPS. Select the correct answer using the codes below.a)1 and 2 onlyb)2 and 3 onlyc)1, 2 and 3d)3 onlyCorrect answer is option 'D'. Can you explain this answer? for UPSC 2024 is part of UPSC preparation. The Question and answers have been prepared according to the UPSC exam syllabus. Information about Consider the following with regards to Base Erosion and Profit Shifting (BEPS). BEPS refers to the phenomenon where companies invest in a host country via shell companies situated in tax havens to reduce their tax liability. The Multilateral Convention to Implement Tax Treaty Related Measures to Prevent BEPS is an outcome of the World Economic Forum BEPS Project. India recently ratified the Multilateral Convention to Implement Tax Treaty Related Measures to Prevent BEPS. Select the correct answer using the codes below.a)1 and 2 onlyb)2 and 3 onlyc)1, 2 and 3d)3 onlyCorrect answer is option 'D'. Can you explain this answer? covers all topics & solutions for UPSC 2024 Exam. Find important definitions, questions, meanings, examples, exercises and tests below for Consider the following with regards to Base Erosion and Profit Shifting (BEPS). BEPS refers to the phenomenon where companies invest in a host country via shell companies situated in tax havens to reduce their tax liability. The Multilateral Convention to Implement Tax Treaty Related Measures to Prevent BEPS is an outcome of the World Economic Forum BEPS Project. India recently ratified the Multilateral Convention to Implement Tax Treaty Related Measures to Prevent BEPS. Select the correct answer using the codes below.a)1 and 2 onlyb)2 and 3 onlyc)1, 2 and 3d)3 onlyCorrect answer is option 'D'. Can you explain this answer?.
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