New Zealand Revenue Minister Peter Dunne on Wednesday welcomed an international report calling on developed nations to devise a joint strategy to tax large multinational companies.

The report from the OECD (Organization for Economic Co- operation and Development) group of developed nations was a good starting point to confront the issue, Dunne said in a statement.

"The issue of large multinationals shifting their profits to countries in order to gain the most favourable tax result is of huge importance to OECD member states who are concerned about how this practice can distort and erode their respective tax bases," Dunne said.

The next steps would be for OECD states to develop an action plan to tackle the issue of base erosion and profit shifting.

"New Zealand has always been a very active participant in this area and our representatives will continue to be deeply involved because we are committed to developing and being part of a strong global response," Dunne said.

Cooperating internationally on base erosion and profit-shifting issues would also help New Zealand to improve its domestic rules.

"The OECD work will help New Zealand and other countries to identify weaknesses in their rules and to ensure that international tax frameworks keep pace with new business models," he said.

"With nations co-operating in this way, we will develop a sound set of tax policies which will mean that the days of large multinationals escaping taxation will be numbered."

Multinational companies selling in New Zealand have come under fire in recent months for paying little or negligible taxes, by putting their tax bases in jurisdictions abroad with the lowest tax demands. Endit

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