Open Access. Powered by Scholars. Published by Universities.®

Law Commons

Open Access. Powered by Scholars. Published by Universities.®

Series

International taxation

Discipline
Institution
Publication Year
Publication

Articles 1 - 30 of 32

Full-Text Articles in Law

Interest Deductibility And International Taxation In Canada After Beps Action 4, David G. Duff Aug 2019

Interest Deductibility And International Taxation In Canada After Beps Action 4, David G. Duff

Faculty Publications

Among the ways in which multinational enterprises (MNEs) can shift profits from one jurisdiction to another in order to minimize taxes, one of the most simple and widely-employed involves the payment of interest to related parties and third parties. For these reasons, it is not surprising that the Organisation for Economic Cooperation and Development’s Action Plan on Base Erosion and Profit Shifting (BEPS) identified the deduction of interest and other financial payments as a significant source of BEPS concerns, and that BEPS Action 4 was charged with developing “recommendations regarding best practices in the design of rules to prevent ...


The Superiority Of The Digital Service Tax Over Significant Digital Presence Proposals, Wei Cui Jul 2019

The Superiority Of The Digital Service Tax Over Significant Digital Presence Proposals, Wei Cui

Faculty Publications

Responding to calls for reallocating taxing rights over multinationals’ profits to reflect the place of user value creation, the OECD recently announced a Program of Work to implement international tax reform. I use the European Commission’s 2018 proposal to introduce the “significant digital presence” concept into income tax treaties as an example of the type of approach the OECD favors, and argue that it is inferior to recently proposed digital services taxes (DSTs). DSTs directly address the question of where profits should be allocated and taxed, while SDP proposals subordinate this vital question to superfluous treaty conventions. Global tax ...


International Taxation In An Era Of Digital Disruption: Analyzing The Current Debate, Itai Grinberg Mar 2019

International Taxation In An Era Of Digital Disruption: Analyzing The Current Debate, Itai Grinberg

Georgetown Law Faculty Publications and Other Works

The “taxation of the digital economy” is currently at the top of the global international tax policymaking agenda. A core claim some European governments are advancing is that user data or user participation in the digital economy justifies a gross tax on digital receipts, new profit attribution criteria, or a special formulary apportionment factor in a future formulary regime targeted specifically at the “digital economy.” Just a couple years ago the OECD undertook an evaluation of whether the digital economy can (or should) be “ring-fenced” as part of the BEPS project, and concluded that it neither can be nor should ...


The Digital Services Tax On The Verge Of Implementation, Wei Cui Jan 2019

The Digital Services Tax On The Verge Of Implementation, Wei Cui

Faculty Publications

France enacted the digital services tax (DST) in 2019, and similar legislation is pending in the United Kingdom, Spain, Italy, and other countries. The DST can be viewed as a tax on location-specific rent (LSR), and it arguably solves genuinely new problems in international taxation. The author briefly reviews this justification of the DST and further examines the DST design in light of three criticisms. The first criticism is that certain features of the DST render it similar to distortionary import tariffs. The second is that the DST would not be borne by digital platforms but would only be shifted ...


International Taxation In An Era Of Digital Disruption: Analyzing The Current Debate, Itai Grinberg Oct 2018

International Taxation In An Era Of Digital Disruption: Analyzing The Current Debate, Itai Grinberg

Georgetown Law Faculty Publications and Other Works

The “taxation of the digital economy” is currently at the top of the global international tax policymaking agenda. A core claim some European governments are advancing is that user data or user participation in the digital economy justifies a gross tax on digital receipts, new profit attribution criteria, or a special formulary apportionment factor in a future formulary regime targeted specifically at the “digital economy.” Just a couple years ago the OECD undertook an evaluation of whether the digital economy can (or should) be “ring-fenced” as part of the BEPS project, and concluded that it neither can be nor should ...


The Digital Services Tax: A Conceptual Defense, Wei Cui Oct 2018

The Digital Services Tax: A Conceptual Defense, Wei Cui

Faculty Publications

As 2018 nears its end, a digital service tax (DST) seems imminent in Europe, yet elaborations of the DST’s motivations have so far come primarily from the European Commission and the UK Treasury: academic and practitioner commentators remain largely skeptical. This paper offers a new conceptual defense of the DST that is independent of the existing government positions. I argue that a clear case can be made for the DST as a way of taxing location-specific rent earned by digital platforms. While the DST may also be partially motivated by other, potentially conflicting visions for reforming international taxation, such ...


Residence-Based Formulary Apportionment: (In-)Feasibility And Implications, Wei Cui Oct 2018

Residence-Based Formulary Apportionment: (In-)Feasibility And Implications, Wei Cui

Faculty Publications

I examine one way of taxing international corporate income that has not previously been studied, “residence-based formulary apportionment” or RBFA. I first offer a new taxonomy of different ways of taxing corporate income by reference to individual shareholders, and distinguish what I call the “shareholder attribution” approach from integration, pass-through, and other approaches. I then argue that although traditional international legal norms had led international tax design to avoid taxing foreign corporations “unconnected” with the taxing jurisdiction (e.g. foreign corporations earning only foreign income), these legal norms have gone through substantial transformations in recent years. The exercise of jurisdiction ...


Taxation, Competitiveness, And Inversions: A Response To Kleinbard, Michael S. Knoll May 2017

Taxation, Competitiveness, And Inversions: A Response To Kleinbard, Michael S. Knoll

Faculty Scholarship at Penn Law

In this report, I argue that the inversion situation is more nuanced, complex, and ambiguous than Edward D. Kleinbard acknowledges, and I challenge Kleinbard’s claim that U.S. multinationals are on a tax par with their foreign competitors.


The Luxembourg Effect: Patent Boxes And The Limits Of International Cooperation, Lilian V. Faulhaber Jun 2016

The Luxembourg Effect: Patent Boxes And The Limits Of International Cooperation, Lilian V. Faulhaber

Georgetown Law Faculty Publications and Other Works

This article uses patent boxes, which reduce taxes on income from patents and other IP assets, to illustrate the fact that the jurisprudence of the European Court of Justice has a longer reach than has previously been recognized. This article argues that, along with having effects within the European Union, the ECJ’s decisions can also have effects on countries outside of the EU. In the direct tax context, the ECJ’s jurisprudence has hampered the ability of both EU and non-EU countries to police international tax avoidance.

In 2015, the Organisation for Economic Co-operation and Development (OECD) proposed restrictions ...


International Tax Policy: The Counter-Story Presented By The Brics, Kim Brooks Jan 2015

International Tax Policy: The Counter-Story Presented By The Brics, Kim Brooks

Articles, Book Chapters, & Blogs

This chapter focuses on the international tax policy directions of Brazil, Russia, India, China, and South Africa (BRICS). The BRICS countries present something of a counter-story to the narrative that international tax law has harmonized. These five countries, major economic and trade players in the world but not members of the Organisation for Economic Co-operation and Development (OECD), have developed their international tax policy with an eye to the approach suggested by the OECD, but not necessarily in conformity with its strictures. This chapter explores the international tax policy directions of the BRICS jurisdictions under the familiar, broad heads of ...


Jurisdiction To Tax Corporations, Omri Y. Marian Jan 2013

Jurisdiction To Tax Corporations, Omri Y. Marian

UF Law Faculty Publications

Corporate tax residence is fundamental to our federal income tax system. Whether a corporation is classified as “domestic” or “foreign” for U.S. federal income tax purposes determines the extent of tax jurisdiction the United States has over the corporation and its affiliates. Unfortunately, tax scholars seem to agree that the concept of corporate tax residence is “meaningless.” Underlying this perception are the ideas that corporations cannot have “real” residence because they are imaginary entities and because taxpayers can easily manipulate corporate tax residence tests. Commentators try to deal with the perceived meaninglessness by either trying to identify a normative ...


Technological Innovation, International Competition, And The Challenges Of International Income Taxation, Michael J. Graetz, Rachael Doud Jan 2013

Technological Innovation, International Competition, And The Challenges Of International Income Taxation, Michael J. Graetz, Rachael Doud

Faculty Scholarship

Because of the importance of technological innovation to economic growth, nations strive to stimulate and attract the research and development ("R&D") that leads to that innovation and to make themselves hospitable environments for the holding of intellectual property ("IP"). Tax policies have taken center stage in their efforts to accomplish these goals and to capture a share of the income from technological innovations.

Designing cost-effective methods of supporting technological innovations has, however, become substantially more difficult as the world economy has become more interconnected. Where R&D is performed and where income is earned change in response to the ...


Technological Innovation, International Competition, And The Challenges Of International Income Taxation, Michael J. Graetz, Rachael Doud Jan 2012

Technological Innovation, International Competition, And The Challenges Of International Income Taxation, Michael J. Graetz, Rachael Doud

Faculty Scholarship

Because of the importance of technological innovation to economic growth, nations strive to stimulate and attract the research and development (“R&D”) that leads to that innovation and to make themselves hospitable environments for the holding of intellectual property (“IP”). Tax policies have taken center stage in their efforts to accomplish these goals and to capture a share of the income from technological innovations. Designing cost-effective methods of supporting technological innovations has, however, become substantially more difficult as the world economy has become more interconnected. Where R&D is performed and where income is earned change in response to the ...


An Equity-Based, Multilateral Approach For Sourcing Income Among Nations, Fred B. Brown Jan 2011

An Equity-Based, Multilateral Approach For Sourcing Income Among Nations, Fred B. Brown

All Faculty Scholarship

The source of income rules used in the United States and elsewhere in large part establish the contours of tax jurisdiction exercised by countries. The source rules play a vital role in the foreign tax credit system applicable to U.S. persons with foreign investment or business activities. The source rules also play a central role in the United States’ exercise of source taxation over foreign persons with U.S. businesses or investments. Other countries likewise use source rules or their equivalent in applying foreign tax credit or territorial systems to their residents and exercising source taxation over nonresidents.

The ...


Reconsidering International Tax Neutrality, Michael S. Knoll Jan 2011

Reconsidering International Tax Neutrality, Michael S. Knoll

Faculty Scholarship at Penn Law

For decades, U.S. international tax policy has shifted back and forth between territorial-source-exemption taxation and worldwide-residence-credit taxation. The former is generally associated with capital import neutrality (CIN) and the latter with capital export neutrality (CEN). One reason why national tax policy has shifted back and forth between those benchmarks is because it is widely accepted that a tax system cannot simultaneously satisfy both CEN and CIN unless tax rates on capital are harmonized across jurisdictions. In this essay, I argue that the international tax literature contains two different and conflicting definitions for CIN. Under one definition, which goes back ...


The Meaning Of 'Enterprise,' 'Business' And 'Business Profits' Under Tax Treaties And Eu Tax Law (Canada), Kim Brooks Jan 2011

The Meaning Of 'Enterprise,' 'Business' And 'Business Profits' Under Tax Treaties And Eu Tax Law (Canada), Kim Brooks

Articles, Book Chapters, & Blogs

This chapter explores the meaning of business as it is used in Canadian income tax law given the four purposes that concept serves.


The Corporate Income Tax And The Competitiveness Of U.S. Industries, Michael S. Knoll Jan 2010

The Corporate Income Tax And The Competitiveness Of U.S. Industries, Michael S. Knoll

Faculty Scholarship at Penn Law

Hit hard by the financial crisis and recession, U.S. auto producers are seeking a massive bailout from the U.S. Congress. Many reasons are given for the U.S. auto industry’s lack of competitiveness including the U.S. corporate income tax. Although it is regularly asserted that there is a direct connection between the corporate income tax and competitiveness, what that connection is has not been carefully spelled out. In this essay, I describe how the corporate income tax directly harms the competitiveness of U.S. industries. I show that the mechanism differs depending upon whether the U ...


Cognitive Capture, Parliamentary Parentheses, And The Rise Of Fractional Apportionment, Stanley I. Langbein Jan 2010

Cognitive Capture, Parliamentary Parentheses, And The Rise Of Fractional Apportionment, Stanley I. Langbein

Articles

No abstract provided.


The Potential Of Multilateral Tax Treaties, Kim Brooks Jan 2010

The Potential Of Multilateral Tax Treaties, Kim Brooks

Articles, Book Chapters, & Blogs

This short chapter canvasses alternative possible approaches governments could adopt if they were serious about better coordinating and possibly harmonizing international tax regimes; explores the potential advantages of using multilateral tax treaties; evaluates the CARICOM multilateral double tax treaty; and concludes by urging the pursuit of multilateral and collective solutions to international tax law design.


The New Poor At Our Gates: Global Justice Implications For International Trade And Tax Law, Ilan Benshalom Jan 2009

The New Poor At Our Gates: Global Justice Implications For International Trade And Tax Law, Ilan Benshalom

Faculty Working Papers

The Article explains why international trade and tax arrangements should advance global wealth redistribution in a world of enhanced economic integration. Despite the indisputable importance of global poverty and inequality, contemporary political philosophy stagnates over the controversy of whether distributive justice obligations should extend beyond the political framework of the nation state. This stagnation results from the difficulty of reconciling liberal impartiality with notions of state sovereignty and accountability. The Article offers an alternative approach that bypasses the controversy of the current debate. It argues that international trade results in relational distributive duties when domestic parties engage in transactions with ...


Taxation And The Competitiveness Of Sovereign Wealth Funds: Do Taxes Encourage Sovereign Wealth Funds To Invest In The United States?, Michael S. Knoll Jan 2009

Taxation And The Competitiveness Of Sovereign Wealth Funds: Do Taxes Encourage Sovereign Wealth Funds To Invest In The United States?, Michael S. Knoll

Faculty Scholarship at Penn Law

Sovereign wealth funds (SWFs) control vast amounts of capital and have made and are continuing to make numerous large, high-profile investments in the United States, especially in the financial services industry. Those investments in particular and SWFs in general are highly controversial. There is much discussion of the advantages and disadvantages to the United States of investments by SWFs and there is an intense and ongoing debate over what should be the United States’ policy towards investments by SWFs. In the course of that debate, some critics have called upon the US government to abandon its long-held public position of ...


International Competitiveness, Tax Incentives, And A New Argument For Tax Sparing: Preventing Double Taxation By Crediting Implicit Taxes, Michael S. Knoll Aug 2008

International Competitiveness, Tax Incentives, And A New Argument For Tax Sparing: Preventing Double Taxation By Crediting Implicit Taxes, Michael S. Knoll

Faculty Scholarship at Penn Law

Tax sparing occurs when a country with a worldwide tax system grants its citizens foreign tax credits for the taxes that they would have paid on income earned abroad, but that escapes taxation by virtue of foreign tax incentives. The supporters of tax sparing argue that it is a form of foreign aid, an obligation owed to developing countries, and a legitimate means of improving the competitiveness of resident investors. Tax sparing, however, has long been opposed by the United States on the grounds that it is an expensive and problematic concession to developing countries, inconsistent with basic and fundamental ...


Value In The Eye Of The Beholder: The Valuation Of Intangibles For Transfer Pricing Purposes, Yariv Brauner Jul 2008

Value In The Eye Of The Beholder: The Valuation Of Intangibles For Transfer Pricing Purposes, Yariv Brauner

UF Law Faculty Publications

This article assesses the desirability of our current, arms' length based, transfer pricing regime by analyzing its theoretical and practical effectiveness in application to transfers of intangibles. A detailed analysis of the practice of valuation of intangibles, which is the key component in the application of this regime, exposes its weaknesses that result in undesirable market incentives. These incentives create a strong bias in favor of large multinational enterprises, yet, even if one favored such bias, it is achieved using an uncontrollable, costly and wasteful legal mechanism. The article particularly criticizes the regime's disregard of the unique characteristics of ...


Business Taxes And International Competitiveness, Michael S. Knoll May 2008

Business Taxes And International Competitiveness, Michael S. Knoll

Faculty Scholarship at Penn Law

Around the world, policymakers are obsessed with the competitiveness of their domestic companies and domestically based multinational corporations (MNCs). Such concerns frequently influence policy, especially tax policy. In this paper, I develop a theory of how taxes affect the international competitiveness of businesses. I then use that theory to evaluate basic tax policy decisions, such as the choice between residence- and source-based taxation and the level of tax rates, and to understand the impact various provisions in the U.S. Internal Revenue Code are likely to have on the competitiveness of U.S.-based corporations and MNCs.


The Quest To Tax Interest Income: Stages In The Development Of International Taxation, Ilan Benshalom Jan 2008

The Quest To Tax Interest Income: Stages In The Development Of International Taxation, Ilan Benshalom

Faculty Working Papers

The Article offers a new perspective on the way international income tax has developed from its nascency, 85 years ago, to the present day. Its main claim is that, due to the lack of a clear normative tax agenda, trade considerations unduly eroded the income tax base. Such trade considerations highlight the importance of reducing tax obstacles on trade and investment to liberalize and integrate international markets. These considerations penetrated international income tax discourse during the Cold War period, when liberalizing trade was part of a broader western agenda to establish dominance through the liberalization of international markets. The Article ...


A Multilateral Solution For The Income Tax Treatment Of Interest Expenses, Michael J. Graetz Jan 2008

A Multilateral Solution For The Income Tax Treatment Of Interest Expenses, Michael J. Graetz

Faculty Scholarship

Recent developments – including greater taxpayer sophistication in structuring and locating international financing arrangements, increased government concerns with the role of debt in sophisticated tax avoidance techniques, and disruption by decisions of the European Court of Justice of member states' regimes limiting interest deductions – have stimulated new laws and policy controversies concerning the international tax treatment of interest expenses. National rules are in flux regarding the financing of both inbound and outbound transactions.

Heretofore, the question of the proper treatment of interest expense has generally been looked at from the perspective of either inbound or outbound investment. As a result, the ...


International Income Allocation In The Twenty-First Century: The Case For Formulary Apportionment, Walter Hellerstein May 2005

International Income Allocation In The Twenty-First Century: The Case For Formulary Apportionment, Walter Hellerstein

Scholarly Works

From an international perspective, formulary apportionment has traditionally been viewed as little more than transfer pricing’s “poor relation” as a division-of-income methodology. It receives only grudging recognition as a method of attributing the profits to a permanent establishment under Article 7 of the OECD Model Tax Convention; it receives no mention at all in Article 9 as a method for distributing the profits of associated enterprises among the contracting states in which they conduct their activities; and it was assailed by the international business community and by the EU Member States as out of step with internationally excepted norms ...


Introduction, Comparative Income Taxation: A Structured Analysis, Hugh J. Ault, Brian J. Arnold Nov 2004

Introduction, Comparative Income Taxation: A Structured Analysis, Hugh J. Ault, Brian J. Arnold

Boston College Law School Faculty Papers

This work presents a comparative analysis of some of the structural and design issues which are involved in mature income tax systems. Countries selected for the study are Australia, Canada, France, Germany, Japan, The Netherlands, Sweden, the United Kingdom and the United States. Each of the systems has evolved its own particular set of approaches and principles, outlined in Part One. Ensuing Parts deal with Basic Income Taxation, Taxation of Business Organizations and International Taxation. There is much to learn in the tax field from a comparative analysis of common problems. One need not believe in the existence of a ...


Oecd Project On Harmful Tax Practices, Hugh J. Ault May 2003

Oecd Project On Harmful Tax Practices, Hugh J. Ault

Boston College Law School Lectures and Presentations

Materials presented in conjunction with a keynote speech delivered on May 15, 2003 at a congress on Tax Competition, organized by the European Tax College and held at Tilburg University, the Netherlands.


The Interaction Of Tax And Non-Tax Treaties, Robert A. Green Jan 2002

The Interaction Of Tax And Non-Tax Treaties, Robert A. Green

Cornell Law Faculty Publications

This background note consists of two parts. Part one provides an overview of the extent to which tax matters are currently covered in non-tax treaties. This discussion focuses on the general agreement on tariffs and trade (GATT)/World Trade Organization (WTO) agreement and the North American free trade agreement (NAFTA) (which cover direct tax measures only to a limited extent) and the European Community (EC) treaty (which covers direct tax measures more broadly). Part two outlines the issues raised when tax matters are covered in non-tax treaties.