Taxation-Transnational Commons^™

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 …

Foreign Income And Domestic Deductions, James R. Hines Jr.

Articles

To what extent should taxpayers deduct expenses incurred domestically that contribute to foreign income production? It is widely believed that if the home country does not tax foreign income, then it also should not permit deductions for that portion of domestic expenses attributable to earning foreign income. This prescription is, however, inconsistent with the decision to exempt foreign income from taxation in the first place. The paper shows that, for any system of taxing foreign income, the consistent and efficient treatment is to permit domestic expense deductions for all expenses incurred domestically. This differs from the current U.S. regime, under …

It-Apas: Harmonizing Inconsistent Transfer Pricing Rules In Income Tax - Customs - Vat, Richard Thompson Ainsworth

Faculty Scholarship

In most jurisdictions there are three separate spheres of transfer pricing analysis - income tax, customs and VAT. Although they share policy objectives, terminology and frequently borrowing methodologies from one another these domestic transfer pricing systems are not in harmony.

Businesses find this lack of harmony costly, problematical, but also a planning opportunity. The door is open for arbitrage.

What if the transfer pricing rules within a jurisdiction were harmonized? The World Customs Organization (WCO) and the Organization of Economic Cooperation and Development (OECD) are considering this question.

This paper synthesizes the range of transfer pricing regimes currently in use, …

Dividend Taxation In Europe: When The Ecj Makes Tax Policy, Alvin C. Warren, Michael J. Graetz

Faculty Scholarship

This article analyzes a complex line of recent decisions in which the European Court of Justice has set forth its vision of a nondiscriminatory system for taxing corporate income distributed as dividends within the European Union. We begin by identifying the principal tax policy issues that arise in constructing a system for taxing cross-border dividends and then review the standard solutions found in national legislation and international tax treaties. Against that background, we examine in detail a dozen of the Court's decisions, half of which have been handed down since 2006. Our conclusion is that the ECJ is applying a …

A Complete Property Right Amendment, John H. Ryskamp

ExpressO

The trend of the eminent domain reform and "Kelo plus" initiatives is toward a comprehensive Constitutional property right incorporating the elements of level of review, nature of government action, and extent of compensation. This article contains a draft amendment which reflects these concerns.

Taxing Services Under The Eu Vat And Japanese Consumption Tax: A Comparative Assessment Of New Eu Place Of Taxation Rules For Services And Intangibles, Richard Thompson Ainsworth

Faculty Scholarship

Place of taxation rules are the seminal cross-jurisdictional provisions of any consumption tax regime. They determine where among competing jurisdictions a particular service is taxed. They are not important for transactions that are restricted to a single jurisdiction and to businesses or individuals belonging to that jurisdiction. However, when two or more jurisdictions are involved, these are the essential tools for revenue allocation and avoidance of double taxation.

It is therefore of considerable importance to Japanese businesses and consumers when the European Union (EU) undertakes a wholesale revision of the place of supply rules for services and intangibles. The European …

Digital Consumption Tax (D-Ct), Richard Thompson Ainsworth

Faculty Scholarship

Modern technology is dramatically changing the way consumption taxes are collected, but it is also changing the way policymakers assess the operation and impact of these taxes. Whether the design is a standard credit-invoice value added tax (VAT) of European design, or a retail sales tax (RST) of American design, or the credit subtraction VAT without invoices type of consumption tax (CT) of Japanese design, technology is having a profound impact.

Government certified transaction software is in place in the United States. The Streamlined Sales Tax offers taxpayers in 18 states the option of having their retail sales tax determined …

Finding New Constitutional Rights Through The Supreme Court’S Evolving “Government Purpose” Test Under Minimum Scrutiny, John H. Ryskamp

ExpressO

By now we all are familiar with the litany of cases which refused to find elevated scrutiny for so-called “affirmative” or “social” rights such as education, welfare or housing: Lindsey v. Normet, San Antonio School District v. Rodriguez, Dandridge v. Williams, DeShaney v. Winnebago County. There didn’t seem to be anything in minimum scrutiny which could protect such facts as education or housing, from government action. However, unobtrusively and over the years, the Supreme Court has clarified and articulated one aspect of minimum scrutiny which holds promise for vindicating facts. You will recall that under minimum scrutiny government’s action is …

Breaking The Bank: Revisiting Central Bank Of Denver After Enron And Sarbanes-Oxley, Celia Taylor

ExpressO

No abstract provided.

Digital Vat And Development: D-Vat And D-Velopment, Richard Thompson Ainsworth

Faculty Scholarship

This article suggests that the time is right for developing countries to consider adopting a comprehensive, fully digital VAT, (complete with certified software and trusted third party intermediaries who could assume all of the taxpayer's VAT responsibilities) within the limited group of enterprises encompassed by the large taxpayer group.

Since the e-commerce revolution began in the 1990's, tax policy discussions in developed economies have enlisted "e-solutions" to streamline consumption tax administration, as well as to resolve technical problems.

Inspiration came from the marketplace. Policy-makers observed widespread, business-initiated e-solutions to consumption tax compliance problems in a wide spectrum of jurisdiction. There …

A Foundation For International Taxation: The Institutional Competence Of Nations, Eric T. Laity

ExpressO

This Article proposes a conceptual foundation for the field of international tax law. The Article refers to this foundation as the institutional competence of nations in global economic development. A nation’s institutional competence is its discretion to make decisions in pursuit of our collective goal of global economic development, discretion that is subject to a number of standards and limitations.

The Article constructs the institutional competence of nations in global economic development from institutional economics, simple game theory, and the literature on social norms. The Article expresses the institutional competence of nations through standards and limitations that reduce the abuse …

The One-Stop-Shop For Vat And Rst: Common Approaches To Eu-U.S. Consumption Tax Issues, Richard Thompson Ainsworth

Faculty Scholarship

In March 2004 the European Commission solicited comments on a proposal to simplify value added tax (VAT) obligations through a one-stop scheme. The proposal was modest in scope. It was designed to build upon the success of a similar scheme that dealt with non-EU established persons supplying digital products to non-taxable EU persons. That scheme is found in Article 26c of the Sixth VAT Directive.

In its March Consultation Paper the Commission proposed that businesses established within the EU be allowed to participate in a one-stop scheme that would be similar to the Article 26c scheme. Limited to B2C transactions, …

E-Commerce And The Taxation Doctrine Of Permanent Establishment In The United States And China, Susan K. Duke

Florida State University Journal of Transnational Law & Policy

No abstract provided.

International Tax As International Law, Reuven S. Avi-Yonah

Law & Economics Working Papers Archive: 2003-2009

The purpose of this article is to introduce to the international lawyer the somewhat different set of categories (e.g., residence and source rather than nationality and territoriality) employed by international tax lawyers, and explain the reasons for some of the differences. At the same time, it attempts to persuade practicing international tax lawyers and international tax academics that their field is indeed part of international law, and that it would help them to think of it this way. For example, knowledge of the Vienna Convention on the Law of Treaties would help international tax lawyers in interpreting tax treaties, and …

The Uneasy Marriage Of Export Incentives And The Income Tax, Mihir A. Desai, James R. Hines Jr.

Articles

This paper investigates the economic effect of tax incentives for American exports. These incentives include a partial tax exemption for export profits (available by routing exports through foreign sales corporations) and the allocation of some export profits to foreign-source income for purposes of U.S. taxation. The analysis highlights three important aspects of these policies. First, official figures appear to understate dramatically the tax expenditures associated with some U.S. export incentives. Correctly measured, total export benefits provided through the income tax are equivalent to a 1-percent ad valorem subsidy. Second, the 1984 imposition of more rigorous requirements for obtaining export subsidies …

Transfer Pricing, Anders Leif Allvin

LLM Theses and Essays

Transfer pricing is one of the principal international taxation issues of the 1990s and potentially of future decades as well. For corporate enterprises, it can be difficult enough to do business in just one country, but it gets even more complex when they go international. The growth of multinational enterprises (MNEs) creates complex taxation issues for both the tax administrations as well for the MNE. Transfer pricing concerns allocation of income earned within affiliated corporate groups in different countries, which must satisfy tax authorities that they are not evading taxes through the use of transfer pricing. The main problem with …

Dumping And Anti-Dumping In International Trade Origins, Legal Nature, And Evolution Developments In Brazil And In The United States, Luiz Claudio Duarte

LLM Theses and Essays

Dumping is when an exporting country sells their goods in the foreign market for less than the price of the goods in their own domestic market. Dumping has a negative connotation because it threatens domestic industries in the importing country. In response to harmful dumping situations, mechanisms of defense have been developed to protect nations from unfair trade practices. The General Agreement on Tariffs and Trade (GATT) recognizes in Article VI anti-dumping tariffs as a legitimate defense to protect domestic industries from foreign predatory pricing practices. This paper focuses on anti-dumping developments in international trade since the beginning of the …

The Unsolved Problem Of The Unfunded Mandate, Edward A. Zelinsky

Articles

No abstract provided.

Tax Harmonization And Coordination In Europe And America, Stephen Utz

Faculty Articles and Papers

No abstract provided.

Unfunded Mandates, Hidden Taxation, And The Tenth Amendment: On Public Choice, Public Interest, And Public Services, Edward A. Zelinsky

Articles

Few contemporary issues concern state and local policymakers as intensely as unfunded mandates. Mayors, county executives, city councilmen, and the professional associations representing them routinely argue that the federal and state governments have, in recent years, imposed at an accelerating rate expensive requirements on municipalities without granting corresponding funds for compliance, thereby irresponsibly straining the fiscal capacity of municipalities, hampering their ability to provide essential services, and improperly infringing upon the scope of local control. The complaints of municipal policymakers have provoked a variety of proposals for restraining unfunded mandates: obligatory disclosure of the projected costs of proposed mandates, requirements …

Taxation And U.S. Multinational Investment, James R. Hines Jr.

Articles

In 1985, nonbank U.S. multinational companies employed 24.5 million workers, had worldwide sales of almost $3.5 trillion, and net income of $150 billion on assets of $4.2 trillion. The foreign (non-U.S.) affiliates of these companies had 6.4 million employees, $900 billion of those sales, and $43 billion of net income, with assets of $838 billion. United States multinationals accounted for roughly three-quarters of total American merchandise exports in 1985 and half of total imports, with approximately 40 percent of each category arising from transfers within U.S. multinationals between American parent firms and their own foreign affiliates. And 1985 is widely …

Federal Income Taxation Of Fine Art, Jeffrey C. Mccarthy

Cardozo Arts & Entertainment Law Journal

No abstract provided.

Introduction: The Value-Added Tax - A Symposium, Edwin T. Hood

Faculty Works

On October 22, 1979, Representative Al Ullman, Chairman of the House Ways and Means Committee, introduced H.R. 5665, the Tax Restructuring Act of 1979. Representative Ullman proclaimed the bill, which contains a ten percent value-added tax, as the "largest adjustment in U.S. taxation since 1913." In his statement accompanying the introduction of H.R. 5665, Chairman Ullman states that the overall purpose for the imposition of a value-added tax coupled with reductions in social security and income taxes, is to correct major flaws in the United States economy-namely double digit inflation, declining productivity, inadequate capital formation, and lag­ging competition with foreign …

Double Jeopardy Of Corporate Profits, The , Constantine N. Katsoris

Faculty Scholarship

The more one reads about our economy, the more one is baffled and alarmed. Permanent solutions to economic problems are elusive. Treating one financial malaise often aggravates another sector of the economy, necessitating a delicate balancing of conflicting interests. Furthermore, the problems are complicated by the constant influence of foreign forces. Nevertheless, most economists agree that any solution will require enormous funding. Unfortunately, the public has little, if any, confidence in our tax system. Indeed, some tax laws and proposals have been referred to as "obscene" and a "disgrace to the human race." Few quarrel with the aptness of such …

Income Averaging, M. Carr Ferguson, Edwin T. Hood

Faculty Works

No abstract provided.

Integration And Economic Development, Robert Birmingham

Faculty Articles and Papers

No abstract provided.