OECD releases recommendations on overhauling corporation tax

The Organisation for Economic Cooperation and Development (OECD) has unveiled its recommendations on overhauling global corporation tax.

The base erosion and profit sharing initiatives have been a year in the making.

Ireland's 12.5% rate and loopholes have been at the centre of discussions since it was criticised by a US Senate committee, Australian politicians and most recently US President Barack Obama.

Pascal Saint-Amans is the OECD's head of tax and says the new seven-point plan sends a "very strong" message to multi-nationals.

"It's the first batch of actions in accordance with the action plan - which was endorsed by the G20 leaders last year - and another package next year will have to be adopted," he said.

"But it's very significant steps towards sending strong message to multi-nationals and countries that it's time to realign the location of the profits and the location of the activities."

Tánaiste Joan Burton says Ireland will have to work with the OECD.

"The Government is fully supportive of the OECD study process," she said.

"That is not going to conclude until sometime I think towards the end of next year.

"But we're fully supportive - we've already made some changes in the context of the finance bill this year."

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