New Delhi, Nov 24 (IANS) With tax avoidance becoming an issue globally, countries like India and China are looking at tax base erosion as a major area of concern.
This was stated in a White paper on "Evolving Global Tax Policy Trends: Outlook for India", scripted jointly by the Confederation of Indian Industry (CII) and global services firm Ernst & Young (EY), a CII release said Sunday.
The report explores some of the emerging trends in global taxation and delineates its implications on India's tax policy.
The paper says that major emerging economies like India and China are actively working with capital exporting developed countries groupings like the Organisation for Economic Cooperation and Development (OECD) on base erosion and profit shifting (BEPS) issues.
Continued growth and reach of multinational businesses across the world has created a complex web of cross-border commercial transactions among related companies, and the world's tax authorities want to ensure that they tax their rightful share of the income from those transactions, the paper said.
The BEPS action plan to address the issue was launched in July by OECD, identifying 15 specific action steps needed to equip governments to prevent "double non-taxation", CII said in the statement.
The paper calls for comprehensive reforms in General Anti-Avoidance Regulations (GAAR), transfer pricing and indirect taxation.
The paper recommends an early implementation of the Goods and Services Tax (GST) in India, which would rationalize the current indirect tax regime in the centre and states, eliminate tax cascading and put the Indian economy on higher growth trajectory, the statement said.
--Indo-Asian News service