The term ‘Base Erosion and profit shifting’ is sometimes seen in the news in the context of
Detailed Explanation:
Answer: Option 2 — curbing of the tax evasion by multinational companies
Base Erosion and Profit Shifting (BEPS) refers to tax planning strategies used by multinational companies to artificially shift profits from higher-tax jurisdictions to lower-tax jurisdictions, thereby eroding the tax base of countries where actual economic activity occurs. The OECD/G20 BEPS Project aims to curb such tax avoidance practices through international cooperation and common standards. Governments worldwide have adopted BEPS measures to prevent multinationals from exploiting gaps and mismatches in tax rules across different countries, ensuring fair taxation where value is created.
Question 4 of 5 Taxation System
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