UPSC Previous Year Question | Prelims GS | 2016

The term 'Base Erosion and Profit Shifting' is sometimes seen in the news in the context of

  1. mining operation by multinational companies in resource-rich but backward areas
  2. curbing of the tax evasion by multinational companies
  3. exploitation of genetic resources of a country by multinational companies
  4. lack of consideration of environmental costs in the planning and implementation of developmental projects

Answer

Correct Answer

curbing of the tax evasion by multinational companies

Explanation

Base Erosion and Profit Shifting (BEPS) refers to tax avoidance strategies used by multinational companies that shift profits to low-tax jurisdictions, and the term is associated with international efforts to curb such tax evasion.

Topics: base erosion and profit shifting, indian economy, international tax issues, taxation