The OECD has issued a report on how international cooperation can be strengthened in the field of corporation tax to counter aggressive tax planning. The report titled “Addressing Base Erosion and Profit Shifting” was commissioned by the G20. The OECD intends to launch an Action Plan to address the issues raised in the report by June 2013 in conjunction with governments and the business community.

The report presents studies and data regarding the existence and magnitude of base erosion and profit shifting (BEPS) and contains an overview of global developments that have an impact on corporate tax matters. The report identifies key principles that underlie the taxation of cross-border activities, as well as the BEPS opportunities these principles may create.

Ireland already operates a robust tax system which counters many of the base erosion and profit shifting threats identified in the OECD's report. Our tax laws and practices are based on a substance of operation principle and Irish tax law also implements well established and wide-ranging anti-avoidance provisions.

As previously reported, the European Commission also launched an Action Plan for a more effective EU response to tax evasion and avoidance last December 2012 which is consistent with the OECD's latest report.