About the indicator

When a country allows resident companies to deduct from their tax base the service payments they have made to affiliates in other countries, this encourages multinational corporations to abuse intra-group service payments to shift profits from a profitable subsidiary to one located in a tax haven, and underpay tax as a result. This indicator assesses if the country restricts or disallows the deduction of intra-group services payments (management fees, technical fees, consulting services fees) to non-resident group affiliates from the corporate income tax base.