Reining in cross-border profit shifting

A RECENT statement by George Osborne, the British Chancellor of the Exchequer, was given wide media coverage in the United Kingdom and elsewhere when he said that he wanted to see “international action” taken against multinational companies which engaged in “profit shifting”.

This was in response to the public outcry against Starbucks, Amazon and Google when it was found that the tax they paid on their UK business activities was a mere fraction of the overall profits they made from such activities.