The finance ministers of the G20 group of most developed countries is meeting in Moscow to set an agenda for the G20 heads of state meeting in September.  A key issue to be addressed by this and the later meeting is taxation of offshore earnings by international companies.  Strange, the very nature of “international” companies is that by operating in many countries their earnings are  always “offshore,” i.e if they earn money in one country that does not mean they earn it in another. To understand the matter one should first understand two basic principals of international business.  First, the subsidiary of a foreign company operates under the laws, including tax laws, of the country in which it is established, not the laws of the country of where its parent may reside.  Second, almost all international trade goes through three countries, the cost center where the product is made and is shipped from at cost and no profit is taken, an intermediary country where the profit is added, and then to the buying country where no profit is taken. Obviously the intermediary country usually has a low tax take. A foreign subsidiary must pay taxes due in the country where it is established.  The parent company pays no taxes until profits are remitted from the foreign subsidiary to the parent.  Thus the concept of taxation on worldwide earnings is distributed among at least two countries and often more.  Thus there is no single taxing authority and each country takes its bite when possible.  For trade the exporting company from a cost center makes no profits so it has no tax obligation in that country.  Likewise the buying country sees no profits made there since the product comes from abroad at its import price which is set abroad.  The profit is made where the export is received, priced for sale and sent on the final destination.  This is usually done in a low tax country.  For most US exports  this is done in one of our territories e.g. Puerto Rico.  Again, only inthe country where the profit is made are there earnings to tax.  To make this even more complex the goods are often not even sent to the intermediary country but the sales transaction is based there. These systems are so ingrained in international business that in my opinion and new initiative taken by the G20 to get a better tax handle on “offshore” funds has the ”likelihood of a spheroid of ice crystals peregrinating through the nether regions without a problem.”