OECD Tax Pact’s Banned-Expenses List Should Be Short, Groups Say

The Organization for Economic Cooperation and Development should trim its list of expenses that are disallowed in companies’ profit calculations under new international tax rules, international business groups say.

Nearly 140 countries have signed on to the OECD-led agreement last year to change how multinationals are taxed. Pillar One of the rules would reallocate a portion of the profits made by the largest, most profitable businesses to countries where they make their sales.

In a Feb. 18 consultation into how companies should calculate the tax base from which the Pillar One reallocation known as Amount A will be made, the ...