OECD prepares changes to corporate taxation

New rules on tax avoidance are big drawn up by the OECD ahead of the next G20 meeting.

All 34 members of the thinktank have agreed to the measures, which will look to limit companies' ability to avoid paying tax. At present, some multinational firms are paying less than one per cent tax on their profits.

Secretary general of the OECD Angel Gurria is pleased to see such widespread commitment on the issue and it means countries should be able to collect the taxes set by their governments, the Guardian reports.

"This is a very challenging piece of work. We have created a regime where it is legal to pay no or little taxes. But I'm very confident we can find a formula that provides a level playing field," he added.

It could be a sign that globally there will be some movement on the issue of tax. In recent weeks, Google's Eric Schmidt admitted he is perplexed by the debate, as his company are not breaking any rules at present.

However, accusations have been levelled at Google and other global brands that while their actions are legal, they are at best morally ambivalent.

The OECD is keen to clamp down on profit shifting, as it said the practice represents a real risk to tax revenues. Moreover, the OECD thinks it is having a negative impact on investment, services and competition.

However, the thinktank is not stopping there, as it has confirmed another 12 countries have signed up or committed to sign the Multilateral Convention on Mutual Administrative Assistance in Tax Matters.

Austria, Luxembourg and Singapore are among the nations on board and this adds to international efforts to crack down on tax offenders.

Mr Gurria heralded the move, as it means over 60 countries have signed up the convention in the past two years. He added this latest step is an "important milestone" on bringing "closer cooperation and more transparency" to the tax system.