The advent of the highly digitalized platform firm has upended the international tax system.  This book contains a critique of the measures put forth by the Organization for Economic Cooperation and Development (OECD) to address the significant challenges posed by this new type of firm, and digitalization more broadly, and presents an alternative, more sustainable approach.  For many decades, the principle of source-based taxation and the arm’s length standard have been foundational elements of the international tax system.   These principles are memorialized in virtually all countries’ transfer pricing regimes.  They have determined individual jurisdictions’ quantitative taxing rights vis-à-vis multinational corporations operating within their borders, and guided the resolution of transfer pricing disputes among tax administrations.   In the wake of the economic metamorphoses set in motion by digitalization, the OECD and many other stakeholders have endorsed a hybrid international tax system of sorts, whereby the principle of source-based taxation and the arm’s length standard would be applied in the first instance to determine the preliminary allocation of in-scope multinational firms’ consolidated pre-tax income across taxing jurisdictions, but these results would be subject to a secondary reallocation designed to ensure that a portion of these firms’ pre-tax income is attributed to, and taxable by, jurisdictions in which consumers and users reside (“market jurisdictions”).  This secondary allocation – the core of the OECD’s Pillar One and an essential element of its two-pronged “Pillar One-Pillar Two Solution” – explicitly deviates from both the arm’s length standard and the principle of source-based taxation.   For many reasons, examined in this book, the OECD’s Pillar One would not provide for the effective taxation of highly digitalized platform firms, and, by extension, it would not stabilize the international tax system.  Among other things, the scope of Pillar One would exclude all but a very small number of behemoth highly digitalized platform firms. Moreover, an international tax system that marries incompatible principles is inherently unstable and ultimately unsustainable.   The author argues that the principle of source-based taxation and the arm’s length standard are entirely compatible with the attribution of a portion of highly digitalized platform firms’ consolidated pre-tax income to market jurisdictions.  However, new transfer pricing methodologies and a revised definition of ‘control’ for transfer pricing purposes are required to achieve this result.  Retaining the long-standing principle of source-based taxation and the arm’s length standard is far preferable to introducing ad hoc, arbitrary, extremely complex and convoluted profit attribution rules, as Pillar One does.  Combining important findings and insights from academic research in a variety of fields with the author’s extensive practical experience in both public and private spheres, this book is appropriate for academics as well as private sector advisors in the fields of transfer pricing and international tax, chief financial officers of multinational corporations and tax policy analysts.