This article examines the case for using a multilateral tax treaty with unitary formulary apportionment to allocate the profits of international enterprises among the countries in which they operate. The article first outlines the problems of the current tax treaty system and the arm's length principle to allocate the profits of international banks and non-bank enterprises. The article then considers the advantages of a multilateral tax treaty over the current treaty system. A multilateral tax treaty is an essential framework for implementing an allocation system based on unitary formulary apportionment. The article makes the case for using unitary formulary apportionment to allocate business profits to permanent establishments under a multilateral tax treaty, focusing on the European Commission's proposals. The article concludes with a study of the issues that arise from implementing unitary formulary apportionment.