The base erosion and anti-abuse tax (BEAT) is an innovative tax that was introduced by the US Congress under the Tax Cuts and Jobs Act 2017 in order to curb base erosion. The tax is charged on transactions undertaken by a US taxpayer with a foreign related person. However, there is a blanket imposed over each and every transaction between a US taxpayer and a foreign related person. No consideration is given to the strong transfer pricing regime adopted by countries such as India, which ensures that if an Indian entity is undertaking a transaction with a US entity, the transaction will take place at arm’s length price and the tax base of the United States is not eroded.