Multinationals Shift Key Functions Based on Taxes, OECD Finds

Multinational enterprises tend to move finance-related functions to jurisdictions with lower effective tax rates, while manufacturing and sales functions are less sensitive to higher tax rates, according to a new report.

Affiliates of companies located in countries with ETRs below 15% were also more likely to conduct holding functions, or to provide internal group finance, the Organization for Economic Cooperation and Development found in a new report based on anonymized real responses of large companies.

• The share of affiliates that perform holding functions is 70% higher in countries with effective tax rates below 15% than those with higher ...