How national governments can, and should, tax the profits of multinational companies has become a topic that has moved strikingly up the political agenda recently. On the one hand, there have been vociferous complaints from activists and politicians that multinational companies have not been paying a fair share of taxes; this view has been particularly marked at a time of austerity in many countries. On the other, tax competition continues unabated, with many countries, including the UK, reforming their corporation taxes to attract business.

The topic is not new, but there is a lack of consensus on the way forward. Is the basic approach of the OECD Model Tax Convention valid, though in need of reform? Does that model yield a fair allocation of tax revenue between countries? Indeed, is there any conceptual foundation for that approach? Would any other approaches lead to better outcomes, and are they feasible? And if so, is there any prospect of an internationally coordinated shift in the basic paradigm that has served for many decades? If not, what does the future hold: will we still be attempting to tax the profit of multinational companies in the coming decades?