Taxation-Transnational Commons^™

The Other Eighty Percent: Private Investment Funds, International Tax Avoidance, And Tax-Exempt Investors, Omri Marian

BYU Law Review

The taxation of private equity managers’ share of funds’ profits—the twenty percent “carried interest”—received much attention in academic literature and popular discourse. Much has been said and written about the fact that fund managers’ profits are taxed at preferred rates. But what about the other eighty percent of funds’ profits? This Article theorizes that the bulk of such profits are never taxed. This is a result of a combination of three factors: First, private equity, venture capital, and hedge funds (collectively, Private Investment Funds, or “PIFs”) are major actors in cross-border investment activity. This enables PIFs to take advantage of …

Gcc Vat: The Intra-Gulf Trade Problem, Richard Thompson Ainsworth, Musaad Alwohaibi

Faculty Scholarship

It seems reasonably clear that by January 1, 2018 events will be set in motion for the adoption of a community-wide 5% value added tax (VAT) in the six Member States of the Gulf Cooperation Council (GCC).

The GCC’s Framework VAT document is expected to be published by the end of October 2016. One of the clearest, consistently placed observations is that the Arabian VATs will be destination-based and modeled on a European credit-invoice design. Intra-Gulf business-to-business (B2B) transactions will be effectively zero-rated by the supplier, and the buyer’s VAT will be directed to the destination jurisdiction. It is not …

Replacing Havoc: Creating Rules For Sovereign Default, Edward J. Kelley

Cleveland State Law Review

Sovereign debt is an ongoing threat to a State’s economic stability and its citizens’ standard of living. A single occurrence of default begins a cycle in which it becomes increasingly more difficult for an indebted State to pay its debts and ensure the survival of its citizens. Because central banking systems and direct spending are often inadequate methods to boost an indebted State’s economy, a more expansive solution to sovereign debt is required. The initial solution to the growing problem of sovereign debt is an international treaty that will allow the world economy to establish monitoring mechanisms to prevent debt …

The Foreign Account Tax Compliance Act: The Solution Or The Problem?, Sophie S. Chou

CMC Senior Theses

Tax evasion has been happening for decades, but after the highly publicized cases with two foreign banks, LGT and UBS, the United States (US) is cracking down on tax evaders. The latest addition to the Internal Revenue Service (IRS)’s repertoire of enforcement tools is the Foreign Account Tax Compliance Act, otherwise known as FATCA. The Act was enacted to incentivize tax information release by foreign financial institutions (FFIs) who would otherwise face a 30% withholding tax on any US source income. The question was whether or not the design of the Act and its implementation successfully met this goal.

This …