Law Commons^™

Money Grab: How The G20/Oecd Inclusive Framework For Taxation Could Unnecessarily Disrupt Corporate Incentives And Misallocate Taxing Rights, William T. Anderson

Vanderbilt Journal of Transnational Law

The Organisation of Economic Co-operation and Development (OECD) is proposing a dramatic shift to international corporate taxation that both sets a floor for corporate tax rates across the globe and transforms how countries obtain taxing rights over large multinational corporations. This Note focuses on the proposed framework for re-allocating taxing rights over corporations away from the traditional requirement of a physical presence in a country to mere revenues in a country. This Note identifies problems with the proposal as it relates to artificially altering corporate incentives and structures, as well as the proposal's incompatibility with theories of taxation- including Adam …

The Stored Communications Act And Digital Assets, David Horton

Vanderbilt Law Review

This Article explores the impact of federal law on a state fiduciary's management of digital assets. It focuses on the lessons from the Stored Communications Act ("SCA'), initially enacted in 1986 as one part of the Electronic Communications Privacy Act. Although Congress designed the SCA to respond to concerns that Internet privacy posed new dilemmas with respect to application of the Fourth Amendment's privacy protections, the drafters did not explicitly consider how the SCA might affect property management and distribution. The resulting uncertainty affects anyone with an email account. While existing trusts and estates laws could legitimately be interpreted to …

The Oecd's Flawed And Dated Approach To Computer Servers Creating Permanent Establishments, Monica Gianni

Vanderbilt Journal of Entertainment & Technology Law

As the digital economy changes the way that we do business, tax laws have been challenged to adapt appropriately to this nontraditional business method. International tax rules were developed in a different technological era. To accommodate electronic commerce, existing tax rules either have to be applied to electronic-commerce transactions, or new rules have to be developed. The Organisation for Economic Co-operation and Development (OECD) has taken the lead in studying and recommending appropriate international taxation rules for electronic commerce. This Article focuses on the original central tax issue that the OECD considered--jurisdiction to tax income from electronic commerce based on …

Piercing The Veil Of Secrecy: Securing Effective Exchange Of Information To Remedy The Harmful Effects Of Tax Havens, Hedda Leikvang

Vanderbilt Journal of Transnational Law

The enforcement of tax laws abroad has long posed problems for authorities. However, that enforcement becomes increasingly more problematic when the information necessary for proper enforcement is located within an impenetrable system whose sole purpose is to protect that information from tax authorities in other countries. Although much effort has been expended to remedy the harmful effects of tax havens, few strategies have succeeded. But with the prospects of a record federal deficit and an ever-increasing tax gap, U.S. authorities have begun to look for new ways to strengthen the enforcement of U.S. tax laws abroad. The most prominent of …

Risky Investment Decisions: How Are Individuals Influenced By Their Groups?, W. Kip Viscusi, Owen R. Phillips, Stephan Kroll

Vanderbilt Law School Faculty Publications

We investigate the effect of group versus individual decision-making in the context of risky investment decisions in which all subjects are fully informed of the probabilities and payoffs. Although there is full information, the lottery choices pose cognitive challenges so that people may not be sure of their expected utility-maximizing choice. Making such decisions in a group context provides real-time information in which group members can observe others’ choices and revise their own decisions. Our experimental results show that simply observing what others in the group do has a significant impact on behavior. Coupling real-time information with group decisions based …

Shortcomings In U.S. Federal Tax Regulatory Regime Of Private Foundations: Insights For Australia, Nina J. Crimm

Vanderbilt Journal of Transnational Law

This Article addresses the need for a more comprehensive regulatory scheme of Australia's nonprofit organizations, particularly its private foundation type structures. By considering the strengths, and more importantly, the weaknesses of the U.S. tax regime of private foundations, Australia can avoid pitfalls that accompany the development of Australia's laws and regulations. The Article begins by exploring the history, nature, and culture of Australia's nonprofit sector. After outlining the structure of the sector, the Article focuses on the potential for abuses if prescribed private funds are not given appropriate attention to avoid such abuses. Then, the Author details the U.S. nonprofit …

Avoiding A Nuclear Trade War: Strategies For Retaining Tax Incentives For U.S. Corporations In A Post-Fsc World, Carrie A. Von Hoff

Vanderbilt Journal of Transnational Law

On January 14, 2002, the World Trade Organization (WTO) Appellate Body affirmed that the FSC Repeal and Extraterritorial Income (ETI) Exclusion Act, a replacement for the Foreign Sales Corporation (FSC) Act, was an unlawful export subsidy under WTO agreements. Though the European Union has indicated a willingness to wait before imposing the largest trade sanctions in the history of the WTO, it insists that the United States comply with the ruling. This Note explores the history of the conflict and considers possibilities for the future of international trade taxation.

This Note first examines the background to the conflict, beginning with …

Spontaneous Tax Coordination: On Adopting A Comparative Approach To Reforming The U.S. International Tax Regime, Anthony C. Infanti

Vanderbilt Journal of Transnational Law

The excessive complexity of the U.S. international tax regime is well documented. Although many commentators have cited the need for simplification, their proposals often maximize other policy goals at the expense of simplicity. Even reform proposals aimed principally at clarifying the tax code are ordinarily focused on the "internal" complexity of the code, seeking improvements only for U.S. taxpayers struggling with a single complex provision of the code or the baffling interaction, of two U.S. rules. This Article focuses on the interaction between U.S. tax law and the rules of other nations, and is intended to illustrate the benefits that …

Foreign Sales Corporations--Subsidies, Sanctions, And Trade Wars, Candace Carmichael

Vanderbilt Journal of Transnational Law

The largest sanctions in the history of the World Trade Organization, the need to stabilize an ailing economy, and the need to maintain strong alliances in the face of a new global war on terrorism are all issues the United States currently faces in deciding how to resolve its dispute with the European Union regarding U.S. tax policy. In 1997, the European Union filed a complaint with the WTO claiming that the then-current U.S. tax regime violated U.S. international trade agreements. The European Union contended that the U.S. tax system gave rise to export-contingent subsidies, in violation of U.S. trade …

U.K. Charity Law: Is It Creating A True Democracy Of Giving?, James R. Michels

Vanderbilt Journal of Transnational Law

In November 1999, the British government announced important legislative reforms affecting the various methods of providing charitable contributions. The government expressed its desire to create a "democracy of giving" by expanding tax relief for charitable donations. These changes took effect in April 2000.

This note argues that the recent legislation reforms, while a step in the right direction, do not create a true "democracy of giving." In arriving at this conclusion, the note will outline the evolution of British tax law related to individual charitable donations. The note will also explore the problems experienced by the charitable sector that prompted …

The Role Of Offshore Jurisdictions In The Development Of The International Trust, David Brownbill

Vanderbilt Journal of Transnational Law

The trust is a common law invention, the product of experience over many years. But the more it is reduced to legislation, the more formalistic it becomes, and the less able it will be to respond to new situations and challenges. The quasi-code approach--and, to a much lesser extent, the targeted approach--also results in a fragmenting of the trust law. The trust has benefited immensely from the relative uniformity of most general principles throughout the Commonwealth and other common law countries. This has enabled developments, in the form of judicial pronouncements, in one country to be freely adopted in others. …

The Trust Offshore, Antony G.D. Duckworth

Vanderbilt Journal of Transnational Law

I was not present at the birth of the offshore financial centers or of their trust business, but I am told that the mother was taxation. Perhaps that is an oversimplification, but I do not doubt that taxation was the major influence. The typical settlor was a taxpayer from one of the major common law countries, and his primary motive for going offshore was tax avoidance. But there were also a few settlors from other places, some motivated by estate planning considerations (the trust allowing them to make property arrangements which could not be made at home), some by fear …

The Rise Of The International Trust, Jeffrey A. Schoenblum

Vanderbilt Journal of Transnational Law

With considerable acuity, Carlyn S. McCaffrey and Elyse G.Kirschner explore the maze created by the new Code and treasury regulation provisions. In addition to affording a fascinating roadmap through the maze, their article, Learning to Live with the New Foreign Nongrantor Trust Rules, demonstrates the difficulty of addressing legislatively the multitude of trust arrangements that can be devised in the struggle between grantors worldwide and the U.S. tax authorities. The article also exposes the inevitable generation of unintended consequences, including new loopholes, that are a product of such legislation.

In a second tax article, Respect for "Form" as "Substance" in …

Respect For "Form" As "Substance" In U.S. Taxation Of International Trusts, Donald D. Kozusko, Stephen K. Vetter

Vanderbilt Journal of Transnational Law

...we might decide that the attribution rule should not be applied so broadly, or so automatically. But how would such a system be devised by regulation? The attribution rule could be applied to trusts in which the discretion of the trustee is very limited and the beneficial interests so clearly ascertainable that the trust is, for all practicable purposes, transparent. That is, however, only a small universe of cases. This leads to the further conclusion that the attribution rule has to be applied based on a facts and circumstances determination of the beneficial interest in each case. Yet that seems …

Corporate Tax Reform: The Key To International Competitiveness, Ann L. Hardman

Vanderbilt Journal of Transnational Law

This Note responds to "Integration of the Individual and Corporate Tax Systems: Taxing Business Income Once," a study the United States Department of the Treasury released on January 6, 1992. This Note explores some of the issues and concerns of integration and considers arguments in support of and against the United States system of taxation. The latter portion of this Note addresses the relationship between international economics and integration, focusing on the potential for international competitive disadvantage under the classical tax system. The author concludes that Congress should read the Treasury's study as a legislative proposal and act upon it …

A Capital Tax System To Preserve America's Heritage, Valerie M. Fogleman

Vanderbilt Journal of Transnational Law

This Article looks to the British national heritage capital tax system as a model to propose provisions in the United States Internal Revenue Code to aid in preserving the United States cultural and natural heritage. After an overview of the capital tax systems in Britain and the United States, Ms. Fogleman examines features of the British tax system that promote preservation of the national heritage. The British system conditionally exempts the owners of national heritage assets from estate or gift tax liability on the transfer of those assets in exchange for permitting public access to and maintaining the assets; allows …

International Tax Evasion: Spawned In The United States And Nurtured By Secrecy Havens, Allaire U. Karzon

Vanderbilt Journal of Transnational Law

The United States system of income taxation is predicated upon the voluntary self-assessment and payment of tax. Voluntary compliance, in turn, depends upon the confidence of United States citizens that the taxation system is basically fair, that the tax burden essential to maintain the government is shared by all in proportion to their net income, and that those who cheat are discovered and prosecuted. Circumstances that allow certain taxpayers to escape their proper tax liability successfully tempt others to seek tax evasion devices for themselves, and, more importantly, demoralize the conscientious majority who pay their just share of taxes but …

Books Received, Journal Staff

Vanderbilt Journal of Transnational Law

Books Received

Direct Investment and Development in the U.S.: A Guide to Incentive Programs, Laws and Distinctions

Raymond J. Waldmann

Washington, D.C.: Transnational Investments, LTD., 1980. Map, Tables and Glossary. Pp. 443.

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Taxing Unfair International Trade Practices

Greyson Byran

Lexington, Mass: Lexington Books, 1980. Pp. 360. $34.95.

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The Constitutions of the Communist World

Edited by William B. Sinons

Netherlands: Sijthoff & Noordhoff, 1980. Pp. 662.

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The Circular

Part I by Eric J. Herpin and Part II by Charles A.Dilley

Brussels: Emile Bruylant, 1979. Pp. 216.

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International Corporate Taxation

Philip P. Postlewaite

Colorado Springs, Colorado: Shepard's/McGraw-Hill Book …

Recent Developments, Benjamin W. Pardue

Vanderbilt Journal of Transnational Law

In 1967 the British government devalued the pound as against the dollar. The year 1969 witnessed the floating of the German mark. More recently the dollar has fluctuated widely in international money markets. Under presently accepted accounting principles United States multinational corporations are required to convert their foreign assets and liabilities into dollars at the year's end rate of exchange. When a foreign currency is devalued against the dollar, the value of that foreign subsidiary's assets also declines. In a corporation's consolidated financial statement such a drop in value may distract investors from the corporation's operating successes, with a corresponding …

Case Digest, Journal Staff

Vanderbilt Journal of Transnational Law

1. Admiralty

Employer is liable as a Pro Hac Vice Owner for Negligence of an Employee Engaged in Services other than Stevedoring

Submersible Oil Storage Facility use in Connection with Off-Shore Drilling is Classifiable as a "Vessel" within Provisions of Jones Act and General Maritime Jurisdiction

Exclusive Remedy Provision of the Puerto Rico Workmen's Accident Compensation Act does not apply to a Puerto Rican Citizen Injured outside the Territory of Puerto Rico

Determination of Unseaworthiness caused by Character of a Person Aboard is Limited to Crew Members' Condition

2. Common Market

European Community Directive Requires that in the Event of …

Case Digest, Journal Staff

Vanderbilt Journal of Transnational Law

1. Admiralty

State Port Authority Acting Incident to Maritime Carriage Subject to Admiralty Jurisdiction in Damage Suit

MARINE INSURANCE PROVIDING COVERAGE OF LOSSES "ARISING FROM OR OCCURRING FROM" SPECIFIED CONDITIONS DOES NOT COVER LOSSES OCCURRING AFTER PERIOD OF COVERAGE DUE TO CONDITIONS WHICH INITIALLY AROSE DURING THE PERIOD OF COVERAGE

FEDERAL COURT LACKS POWER UNDER SUITS IN ADMIRALTY ACT TO IMPOSE GOVERNMENTAL LIABILITY FOR HARM CAUSED BY FAILURE TO EXERCISE DISCRETIONARY FUNCTION

2. Alien's Rights

FAMILY RELATIONSHIP CAN BE SHOWN AS A MATTER OF FACT FOR IMMIGRATION PURPOSES WHERE APPLICABLE FOREIGN DOMESTIC LAW HOLDS MEANINGLESS THE CONCEPT OF LEGITIMACY

3. …

The Steel Products Decision: An Inquiry Into The Treatment Of The Value-Added Tax Under The Countervailing Duty Law, Charles L. Chambers

Vanderbilt Journal of Transnational Law

It is not often that one small clause in a tariff act becomes a major issue between domestic producers and the firms which import competitive foreign goods, a major issue in trade talks between the United States and the European Community, and a bone of contention between the Congress and the Executive Branch. Yet, section 303 of the Tariff Act of 1930 has done just that and no solution to the issues it has raised is in sight...

Section 303 of the Tariff Act of 1930 is simple enough on its face. It imposes a countervailing duty on any goods …

Case Digest, Journal Staff

Vanderbilt Journal of Transnational Law

1. Admiralty Shipowner's Warranty of Seaworthiness extends to any Regularly Used Mode of Ingress or Egress

Award of Prejudgment Interest in Admiralty may be Denied Party Substantially at Fault

Contribution will lie against the United States in Non-collision Maritime Cases when United States and Third Party Adjudged Mutually Negligent

Admiralty Jurisdiction does not Extend to Shoreside Injury Caused by Unloaded Cargo

Admiralty Jurisdiction does not Extend to Shoreside Injury Caused by Negligent Handling of Shipowner's Dunnage when Stevedore uses Own Equipment

2. ARBITRATION

Foreign Arbitration Award may be Enforceable at Bankruptcy although Issued after Initiation of Bankruptcy Proceedings

3. CONTRACTS …

Tax Consequences Of Foreign Currency Fluctuations, Sheldon S. Cohen

Vanderbilt Journal of Transnational Law

This article concerns the United States federal income tax treatment of the gains and losses resulting from transactions involving currencies other than the United States dollar. United States income taxes must be computed and paid in United States dollars. Therefore, when persons subject to United States income taxes engage in transactions involving foreign currencies, they must account for their profits in terms of dollars for United States income tax purposes. This result follows even if the taxpayer does not actually convert the results of these transactions into dollars. Whether the failure to convert is voluntary, or results from legal restrictions …