The 50 Ideas that Shaped Business Today

Tax optimisation

Towards the end of the 20th century, as companies sharpened their focus on shareholder value, they stopped seeing tax as a cost of doing business and started to see their tax departments as potential profit centres that could boost their bottom line.

The result was an explosion of aggressive tax planning in which companies used artificial schemes and shelters. When tax authorities fought back, multinationals pursued a different line of attack, exploiting the growing tax competition between countries.

Companies put divisions, activities and even head offices in low-tax countries. As companies became more international, they felt less bound by national loyalties.

Tax-efficient structures allowing profits to be shifted to low-tax ...