{"id":91393,"date":"2025-06-01T10:54:51","date_gmt":"2025-06-01T10:54:51","guid":{"rendered":"https:\/\/exam.pscnotes.com\/mcq\/?p=91393"},"modified":"2025-06-01T10:54:51","modified_gmt":"2025-06-01T10:54:51","slug":"the-term-base-erosion-and-profit-shifting-is-sometimes-seen-in-the-n","status":"publish","type":"post","link":"https:\/\/exam.pscnotes.com\/mcq\/the-term-base-erosion-and-profit-shifting-is-sometimes-seen-in-the-n\/","title":{"rendered":"The term ‘Base Erosion and Profit Shifting’ is sometimes seen in the n"},"content":{"rendered":"

The term ‘Base Erosion and Profit Shifting’ is sometimes seen in the news in the context of<\/p>\n

[amp_mcq option1=”mining operation by multinational companies in resource-rich but backward areas” option2=”curbing of the tax evasion by multinational companies” option3=”exploitation of genetic resources of a country by multinational companies” option4=”lack of consideration of environmental costs in the planning and implementation of developmental projects” correct=”option2″]<\/p>\n

\n
\n
This question was previously asked in<\/div>\n
UPSC IAS – 2016<\/div>\n<\/div>\n
Download PDF<\/a>Attempt Online<\/a><\/div>\n<\/div>\n
\nThe correct option is B, as the term ‘Base Erosion and Profit Shifting’ is seen in the news in the context of curbing tax practices by multinational companies.
\n<\/section>\n
\n– ‘Base Erosion and Profit Shifting’ (BEPS) refers to tax planning strategies used by multinational enterprises (MNEs) to exploit gaps and mismatches in tax rules across different countries.
\n– These strategies allow MNEs to ‘erode’ their tax base in higher-tax jurisdictions and ‘shift’ profits to lower-tax jurisdictions, often where there is little or no real economic activity, resulting in minimal or no corporate tax being paid.
\n– The OECD (Organisation for Economic Co-operation and Development) initiated the BEPS project to tackle these issues and ensure that profits are taxed where economic activities generating the profits are performed and where value is created. Thus, it is about curbing tax avoidance (which is legal but exploits loopholes) by multinational companies.
\n– Options A, C, and D relate to different issues (mining, genetic resources, environmental costs) unrelated to BEPS.
\n<\/section>\n
\nThe OECD\/G20 Inclusive Framework on BEPS brings together over 140 countries and jurisdictions to collaborate on the implementation of BEPS measures and address remaining BEPS issues.
\n<\/section>\n","protected":false},"excerpt":{"rendered":"

The term ‘Base Erosion and Profit Shifting’ is sometimes seen in the news in the context of [amp_mcq option1=”mining operation by multinational companies in resource-rich but backward areas” option2=”curbing of the tax evasion by multinational companies” option3=”exploitation of genetic resources of a country by multinational companies” option4=”lack of consideration of environmental costs in the planning … <\/p>\n

Detailed SolutionThe term ‘Base Erosion and Profit Shifting’ is sometimes seen in the n<\/span><\/a><\/p>\n","protected":false},"author":1,"featured_media":0,"comment_status":"closed","ping_status":"open","sticky":false,"template":"","format":"standard","meta":{"footnotes":""},"categories":[1092],"tags":[1098,1120,1196],"class_list":["post-91393","post","type-post","status-publish","format-standard","hentry","category-upsc-ias","tag-1098","tag-economic-development","tag-fiscal-policy-revenue","no-featured-image-padding"],"yoast_head":"\nThe term 'Base Erosion and Profit Shifting' is sometimes seen in the n<\/title>\n<meta name=\"description\" content=\"The correct option is B, as the term 'Base Erosion and Profit Shifting' is seen in the news in the context of curbing tax practices by multinational companies. - 'Base Erosion and Profit Shifting' (BEPS) refers to tax planning strategies used by multinational enterprises (MNEs) to exploit gaps and mismatches in tax rules across different countries. - These strategies allow MNEs to 'erode' their tax base in higher-tax jurisdictions and 'shift' profits to lower-tax jurisdictions, often where there is little or no real economic activity, resulting in minimal or no corporate tax being paid. - The OECD (Organisation for Economic Co-operation and Development) initiated the BEPS project to tackle these issues and ensure that profits are taxed where economic activities generating the profits are performed and where value is created. Thus, it is about curbing tax avoidance (which is legal but exploits loopholes) by multinational companies. - Options A, C, and D relate to different issues (mining, genetic resources, environmental costs) unrelated to BEPS.\" \/>\n<meta name=\"robots\" content=\"index, follow, max-snippet:-1, max-image-preview:large, max-video-preview:-1\" \/>\n<link rel=\"canonical\" href=\"https:\/\/exam.pscnotes.com\/mcq\/the-term-base-erosion-and-profit-shifting-is-sometimes-seen-in-the-n\/\" \/>\n<meta property=\"og:locale\" content=\"en_US\" \/>\n<meta property=\"og:type\" content=\"article\" \/>\n<meta property=\"og:title\" content=\"The term 'Base Erosion and Profit Shifting' is sometimes seen in the n\" \/>\n<meta property=\"og:description\" content=\"The correct option is B, as the term 'Base Erosion and Profit Shifting' is seen in the news in the context of curbing tax practices by multinational companies. - 'Base Erosion and Profit Shifting' (BEPS) refers to tax planning strategies used by multinational enterprises (MNEs) to exploit gaps and mismatches in tax rules across different countries. - These strategies allow MNEs to 'erode' their tax base in higher-tax jurisdictions and 'shift' profits to lower-tax jurisdictions, often where there is little or no real economic activity, resulting in minimal or no corporate tax being paid. - The OECD (Organisation for Economic Co-operation and Development) initiated the BEPS project to tackle these issues and ensure that profits are taxed where economic activities generating the profits are performed and where value is created. Thus, it is about curbing tax avoidance (which is legal but exploits loopholes) by multinational companies. - Options A, C, and D relate to different issues (mining, genetic resources, environmental costs) unrelated to BEPS.\" \/>\n<meta property=\"og:url\" content=\"https:\/\/exam.pscnotes.com\/mcq\/the-term-base-erosion-and-profit-shifting-is-sometimes-seen-in-the-n\/\" \/>\n<meta property=\"og:site_name\" content=\"MCQ and Quiz for Exams\" \/>\n<meta property=\"article:published_time\" content=\"2025-06-01T10:54:51+00:00\" \/>\n<meta name=\"author\" content=\"rawan239\" \/>\n<meta name=\"twitter:card\" content=\"summary_large_image\" \/>\n<meta name=\"twitter:label1\" content=\"Written by\" \/>\n\t<meta name=\"twitter:data1\" content=\"rawan239\" \/>\n\t<meta name=\"twitter:label2\" content=\"Est. reading time\" \/>\n\t<meta name=\"twitter:data2\" content=\"1 minute\" \/>\n<!-- \/ Yoast SEO Premium plugin. -->","yoast_head_json":{"title":"The term 'Base Erosion and Profit Shifting' is sometimes seen in the n","description":"The correct option is B, as the term 'Base Erosion and Profit Shifting' is seen in the news in the context of curbing tax practices by multinational companies. - 'Base Erosion and Profit Shifting' (BEPS) refers to tax planning strategies used by multinational enterprises (MNEs) to exploit gaps and mismatches in tax rules across different countries. - These strategies allow MNEs to 'erode' their tax base in higher-tax jurisdictions and 'shift' profits to lower-tax jurisdictions, often where there is little or no real economic activity, resulting in minimal or no corporate tax being paid. - The OECD (Organisation for Economic Co-operation and Development) initiated the BEPS project to tackle these issues and ensure that profits are taxed where economic activities generating the profits are performed and where value is created. 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