Law Commons^™

Transfer Pricing Disputes In The United States, Reuven S. Avi-Yonah

Book Chapters

In 1988, the US Treasury Department published a study of inter-company pricing (the 'White Paper') that included the following endorsement of the so-called arm's length standard (ALS) for examining the reasonableness of transactions between related parties for tax purposes: The arm's length standard is embodied in all U.S. tax treaties; it is in each major model treaty, including the U.S. Model Convention; it is incorporated into most tax treaties to which the United States is not a party; it has been explicitly adopted by international organizations that have addressed themselves to transfer pricing issues; and virtually every major industrial nation …

The Tax Revenue Capacity Of The U.S. Economy, James R. Hines Jr.

Book Chapters

The United States imposes smaller tax burdens than do other large high-income countries, its 24.8 percent ratio of tax collections to GDP in 2010 representing the lowest fraction among the G-7. The United States also differs from other G-7 countries in relying relatively little on expenditure-type taxes. It follows that there is significant unused tax capacity in the United States that could be deployed to pay the country’s debts, but that the most promising source of additional tax revenue is expenditure taxation that is widely perceived to have very different distributional features than the income taxes on which the U.S. …

Closing The International Tax Gap Via Cooperations, Not Competition, Reuven S. Avi-Yonah

Book Chapters

All three major goals of the Volcker task force — reducing tax evasion and loopholes, simplifying the code, and reducing corporate welfare — can be advanced by focusing on the international aspects of the tax gap. These aspects include both enforcement of existing U.S. law on U.S. residents earning income overseas (the evasion issue) and reforming deferral for U.S.-based multinational enterprises (the avoidance issue). To best advance the task force’s three goals, I would propose a change in each of these two major international areas.

Corporate Taxation And International Competition, James R. Hines Jr.

Book Chapters

Many countries tax corporate income heavily despite the incentives that they face to reduce tax rates in order to attract greater investment, particularly investment from foreign sources. The volume of world foreign direct investment (FDI) has grown enormously since 1980, thereby increasing a country's ability to attract significant levels of new investment by reducing corporate taxation. The evidence indicates, however, that corporate tax collections are remarkably persistent relative to gross domestic product ( GDP), government revenues, or other indicators of underlying economic activity or government need. If this were not true- if corporate income taxation were rapidly disappearing around the …

Commentary, Reuven S. Avi-Yonah

Book Chapters

David Rosenbloom has delivered an important lecture on an important topic: whether exploiting differences between the tax system of two different jurisdictions to minimize the taxes paid to either or both ("international tax arbitrage") is a problem, and if so, whether anything can be done about it in a world without a "world tax organization." As Rosenbloom states, international tax arbitrage is "the planning focus of the future," and recently has been the focus of considerable discussion and debate (for example, upon the promulgation and subsequent withdrawal under fire of Notice 98-11). Rosenbloom's lecture is one of the first attempts …

Why Was The U.S. Corporate Tax Enacted In 1909?, Reuven S. Avi-Yonah

Book Chapters

This chapter argues that the principal reason the US adopted the corporate tax in 1909 was to regulate corporate managerial power, and that in this regard the 1909 tax differed both from the 1894 corporate tax and from current conceptions of the tax as an indirect tax on corporation’s shareholders.

The United States has had a corporate income tax since 1909. Currently, this tax is under significant criticism, with several academics and practitioners calling for its abolition. It therefore seems appropriate in this context to try to determine what led to the enactment of this tax, and whether the original …

Estate And Gift Taxation, Douglas A. Kahn

Book Chapters

ANSWERING TAX EXAMINATION QUESTIONS

The key to writing a successful answer to a tax question (as with any law exam) is to locate the relevant issues and to analyze them by interrelating applicable legal principles with the basic facts of the question. This determination of relevant issues must be tied to the facts presented in the question.

The first step in question analysis is to read the facts closely and note each element in the facts that is relevant to issues you have studied in the subject being tested since it is likely that the examiner intended that those issues …