Law Commons^™

Vat Triangulation With A Us Middleman Vstr, C-587/10, Richard Thompson Ainsworth

Faculty Scholarship

It is not every day that an American firm finds itself in the middle of an EU VAT controversy that significantly develops the law. However, the September 27, 2012 decision of the European Court of Justice (ECJ) does just that. The case is Vogtländische Straβen-,Tief- und Rohrleitungsbau GmbH Rodewisch (VSTR) v. Finanzamt Plauen.

In November 1998 Atlantic International Trading Company (AIT), an American company established in New York, NY, purchased two stone-crushers from VSTR, a firm established in Germany. AIT quickly re-sold the stone-crushers to an end user established in Finland. The VSTR/AIT contract was “ex works,” that is AIT …

Vat Fraud & Triangulation, Richard Thompson Ainsworth

Faculty Scholarship

Missing trader intra-community (MTIC) fraud has received a lot of domestic enforcement attention. True cross border enforcement (joint or coordinated multi-Member State audit) has been limited. There are signs that this is changing as the Member States become more aggressive in their search for revenue.

Along with this shift in enforcement focus, triangulation analysis has moved from being an interesting aspect of the MTIC fraud structure to the central element in a larger understanding of how a fraudster thinks and how he carries out his fraud. We are coming to understand that triangulations are not only the mechanism of how …

Panelist, A Policy Framework For Knowledge-Based Capital, Hugh Ault

Hugh J. Ault

No abstract provided.

Är Det Möjligt Att Utforma Eu-Förenliga Skatteflyktsregler? En Analys Med Särskilt Fokus På Eu-Domstolens Proportionalitetsbedömning, Maria Hilling

Maria Hilling

No abstract provided.

Real-Time Collection Of The Value-Added Tax: Some Business And Legal Implications, Richard Thompson Ainsworth, Boryana Madzharova

Faculty Scholarship

Recent estimates of the level of VAT fraud in the EU are commensurate with the EU budget. With the Green paper on the future of VAT, the European Commission stressed the urgency and necessity of comprehensive VAT reforms. This paper analyses the business and legal implications of the recently proposed split-payment mechanism, which, if implemented, would move VAT’s method of collection to real-time. The discussion is positioned in the context of two increasingly visible trends in the EU – the general shift towards greater reliance on indirect taxation and the growing popularity of electronic payment instruments. The potential implementation of …

How Nations Share, Allison Christians

Indiana Law Journal

Every nation has an interest in sharing the gains they help create by participating in globalization. Citizens should be very interested in discovering how well their governments fare in claiming an adequate share of this international income stream, since a government that cannot or will not exert its taxing jurisdiction internationally is potentially missing out on a very large and very productive source of revenue. Yet it is all but impossible for citizens to observe exactly how, or how well, their governments navigate this aspect of economic globalization. The vast majority of international tax law plays out in practice through …

Fatca: A Big Concern For Fat Cats And Small Fries Alike, Wayne C. Wood

In the Balance

No abstract provided.

Akteure Des Internationalen Steuerrechts Und Ihre Handlungsformen, Hugh Ault

Hugh J. Ault

No abstract provided.

Slicing The Shadow: A Proposal For Updating U.S. International Taxation, Reuven S. Avi-Yonah

Articles

In the article Avi-Yonah proposed that the United States tax multinational corporations using a formulary apportionment system based solely on income derived from sales. The background for the article was drawn principally from Robert Reich’s The Work of Nations (1991), and the analysis was inspired by Stanley I. Langbein’s work on transfer pricing, especially his seminal article "The Unitary Method and the Myth of Arm’s Length," Tax Notes, Feb. 17, 1986, p. 625; see also Louis Kauder, "Intercompany Pricing and Section 482: A Proposal to Shift From Uncontrolled Comparables to Formulary Apportionment Now," Tax Notes, Jan. 25, 1993, p. 485.

Paper On The Business Case For Transparency, Perrine Toledano

Columbia Center on Sustainable Investment Staff Publications

CCSI strongly supports the transparency of contracts and tax flows. CCSI shares the belief of many stakeholders that transparency is essential to leverage extractive industries for sustainable development and is in the mutual interest of all stakeholders. However, some industry players continue to voice the concern that increased transparency would be harmful for their business. Therefore, CCSI is working to also establish the business case for transparency.

In one such case, some industry players have been lobbying against the regulations developed by the Security and Exchange Commission to implement the mandatory disclosure provisions of the Dodd Frank Wall Street Reform …

Fatca: Toward A Multilateral Automatic Information Reporting Regime, Joanna Heiberg

Washington and Lee Law Review

No abstract provided.

A Perfect Storm In The Eu Vat: Kittel, 'R' And Marc, Richard Thompson Ainsworth

Faculty Scholarship

EU VAT authorities are close to turning the tables on missing traders. For many years organized fraudsters have been stealing huge amounts of VAT on the domestic re-sale of exempt cross-border supplies. Losses have been enormous whether the transactions are in goods (notably cell phones and computer chips) or in tradable services (CO2 permits and VoIP). No market has been safe from the fraudsters.

Answers are developing, but these answers may look more like Armageddon than measured enforcement. Solutions are so draconian, and so all-encompassing that very few intra-community traders will feel safe from the gathering storm. The situation is …

Vive La Petite Difference: Camp, Obama, And Territoriality Reconsidered, Reuven S. Avi-Yonah

Articles

The recent tax reform proposals by House Ways and Means Committee Chair David Camp, R-Mich., and by President Obama seem to offer starkly contrasting visions of how to reform the taxation of foreign-source income earned by U.S.-based multinational enterprises.1 Both acknowledge the problem, which is that U.S.-based MNEs currently have more than $1 trillion of ‘‘permanently reinvested’’ income offshore, which they cannot bring back to the U.S. without incurring a 35 percent tax penalty. However, they seem to offer radically different solutions: Under the Camp proposal, a participation exemption will enable U.S.-based MNEs to bring back the income without paying …

Is There A Need To 'Substantially Modify' The Terms Of The Trips Agreement?, Varun Vaish

Varun Vaish

The TRIPS Agreement is no stranger to controversy and since its inception has been subject to harsh criticism and calls for modification. The task of defending the TRIPS Agreement, particularly from the point of view of an observer from a third world country is, therefore no mean feat. This article focuses on four major fields where a substantial modification of the TRIPS is being debated and suggests that in the light of the recent decisions of the TRIPS Council, the special and differential treatment incorporated, the intrinsic flexibilities available, and the initiatives undertaken at Doha, ‘substantial modification’ is avoidable. The …

Refund Fraud? - Real-Time Solution! Digital Security Borrowed From The Vat (Brazil, Quebec, & Belgium), Richard Thompson Ainsworth

Faculty Scholarship

This article provides support for a proposal to eliminate refund fraud in the U.S. by turning Forms W-2, and 1099 into self-certified/ self-authenticated tax documents. The proposal suggests that a “digital signature” of these documents should be taken after they are completed. The signature should then be made part of the final document.

This proposal was initially advanced in Refund Fraud? Real-Time Solution! The underlying premise of that article was that the US could dramatically reduce, if not eliminate, refund fraud if it borrowing digital security techniques from the VAT. The article did not however, explain or expand upon these …

International Taxation And Competitiveness: Introduction And Overview, Reuven S. Avi-Yonah, Nicola Sartori

Law & Economics Working Papers

The debate about whether to abolish deferral or to adopt territoriality has been going on ever since the Kennedy Administration first proposed ending deferral in 1961. The problem is that neither side has factual support for their argument about whether the U.S. tax system, including Subpart F, as currently enacted or with any of the proposed reforms, in fact negatively impacts the tax burden of US-based MNEs. Even the concept of competitiveness itself is unclear. Despite numerous claims, there has been no rigorous attempt that we are aware of to determine whether MNEs based in our major trading partners in …

La Transparencia En La Protección De Datos Personales, Bruno L. Costantini García

Bruno L. Costantini García

La Transparencia en la Protección de Datos Personales, ponencia elaborada dentro de los trabajos del VII Congreso Nacional de Organismos Públicos Autónomos (OPAM)

New Reporting Requirements For Foreign Financial Assets, Christopher Rossi

The Contemporary Tax Journal

No abstract provided.

The Contemporary Tax Journal Volume 2, No. 1 – Spring 2012

The Contemporary Tax Journal

No abstract provided.

Black Swans: Recapitulative Statements/Vies (Vat) & Use Tax Reciprocity (Rst), Richard Thompson Ainsworth

Faculty Scholarship

There is fundamentally no difference between a value added tax (VAT), and a retail sales tax (RST) when it comes to collecting the tax on cross-border sales. If (under a VAT) a seller is allowed to “zero-rate” cross-border sales, or if (under a RST) a seller is exempt from collecting the tax on cross-border sales, the critical enforcement question is exactly the same – how does the system assure that the buyer will self-assess (and pay) the tax?

The simple answer is that the tax administration audits. The more complicated answer notes that the effectiveness of the audit (by the …

The Connection Between Competitiveness And International Taxation, Michael S. Knoll

All Faculty Scholarship

The term “competitiveness” is a highly elastic concept that has been used in a myriad of different ways. However, in discussions of the connection between international taxation and competitiveness, there are two conceptions of competitiveness that are frequently used, but are not always clearly distinguished from one another. One conception emphasizes the competition between firms to be profitable and grow by acquiring productive assets. The other conception focuses on the competition between states to attract investment capital and people by varying their regulations.

Those two conceptions of competitiveness each imply a distinct definition of a domestic industry and a different …

The U.S. Tax System: Where Do We Go From Here?, Adele C. Morris

Brookings Scholar Lecture Series

This talk will explore how the U.S. tax system really works, where revenue comes from, where spending goes, what a tax expenditure is, and discuss deficit prognoses and how the recent political debates could affect our economy. The speaker will highlight some advantages and disadvantages of different budget balancing options.

The Alternative Forms Of Dispute Settlement And The Essential Difference Between These And Arbitration, Michael Diathesopoulos

Michael Diathesopoulos

The paper examines the characteristics of some common alternative forms of dispute settlement and their key differences from arbitration regarding their nature and scope. Its purpose is to explore each mechanism's suitability for specific types of disputes.

Americans' Unwillingness To Pay Taxes Before The American Revolution: An Uncomfortable Legacy, Richard A. Westin

Law Faculty Scholarly Articles

When one reflects on the sorry condition of America’s finances one has to wonder why there is such resistance to fiscal discipline. Is it merely because there is an obstreperous group in the US Congress who cannot abide any tax? Has the public been subtly lobbied into believing that American taxes are high, pointless and intolerable or is there some gene in the America’s body politic that has always been there that expresses itself from time to time in a pernicious cheapness? Perhaps all those things are true, or perhaps none. Nevertheless, a glance backward at Colonial days can stimulate …

Aspectos Generales Dela Publicidad En México. "La Publicidad De Productos, Servicios, Y Actividades Reguladas Por La Ley General De Salud", Bruno L. Costantini García

Bruno L. Costantini García

Introducción a las generalidades de la regulación en materia de publicidad de insumos para el consumo humano (salud) en México.

Inconstitucionalidad Del Cobro Del Impuesto Sobre La Renta Sobre Jubilaciones, Pensiones Y Haberes De Retiro, Guillermo Castorena

Guillermo Castorena

Argumentos de inconstitucionalidad del precepto. - La LISR no grava el ingreso por pensiones y por ende artículo el 109 fracción III es inconstitucional al no existir el objeto del gravamen. - Violación al artículo 5º de la Constitución Política de los Estados Unidos Mexicanos (CPEUM) pues al ser las pensiones, jubilaciones y haberes de retiro producto del trabajo, la retención realizada con fundamento en el artículo 109 fracción III, constituye una doble tributación. - Violación a los artículos 123 y 127 de la CPEUM, que señalan que el salario será gravable, pero no así la pensión. - Violación a …

The International Tax Bible - Management (Intra-Group) Service Fee Case, Sung-Soo Han

Sung-Soo Han

The International Tax Bible - Treaty Shopping Case, Sung-Soo Han

Sung-Soo Han

This position paper was made for the purpose of discussion with the Korean tax authority during the tax audit period against a foreign subsidiary company doing business in Korea. This kind of tax audit defense approach was a new one at that time. This position paper was inserted in the book "the International Tax Bible(국제조세바이블)" which was published in January 2012. When this report was made, there was no specific rules concerning the "treaty shopping" in the Korean tax law and thus there often took place conflicts between taxpayers and tax authorities with regard to the appropriateness of treaty shopping. …

The International Tax Bible - Transfer Pricing Case, Sung-Soo Han

Sung-Soo Han

The Unjustified Subsidy: Sovereign Wealth Funds The Foreign Sovereign Tax Exemption, Jennifer Bird-Pollan

Fordham Journal of Corporate & Financial Law

The taxation of Sovereign Wealth Funds in the United States is outmoded and due for reconsideration. Offering a tax exemption to the billion dollar investment funds owned by foreign governments is both unfair and ineffective. Founded in the principles of sovereign immunity, the foreign sovereign tax exemption, codified in I.R.C. § 892, fails to satisfy the Congressional goals that motivated its creation. This Article explains the current taxation of foreign sovereigns and, by extension, Sovereign Wealth Funds. It then illustrates that the current exemption is simultaneously too broad, providing a tax exemption for activities that are clearly nongovernmental activities, and …