Permanent establishment as a foreign direct investment in Poland: identification of tax barriers in the context of new tax development

Abstract The paper aims to identify the significant tax barriers to foreign direct investment (FDI) in Poland, in particular in the form of a permanent establishment (PE), in the context of new developments in international tax law. Due to the recommendations of the Base Erosion and Profit Shifting (BEPS) project, launched by Organisation for Economic Co-operation and Development (OECD) to prevent international tax avoidance, the understanding of PE has changed, which could lead to changes in business models. The purpose of the research is also to identify the significant tax barriers to economic activity in Poland, in particular in the form of PE, against the international tax law context. The study conducted by the authors relies on the most current tax rulings and judgments of administrative courts issued between 2017 and 2020. It is concluded that not so much the effective tax burdens but the regulatory ambiguity surrounding the tax obligations may contribute to the reduction of Poland's attractiveness as a location for FDI.

Download Full-text

Foreign direct investment and the Covid-19 pandemic: The real economy perspective and theoretical implications

Towards the „new normal” after COVID-19 – a post-transition economy perspective ◽

10.18559/978-83-8211-061-6/i7 ◽

2021 ◽

pp. 90-99

Author(s):

Marian Gorynia ◽

Piotr Trąpczyński

Keyword(s):

International Economic ◽

Foreign Direct Investment ◽

Economic Activity ◽

Direct Investment ◽

Business Models ◽

Theoretical Perspective ◽

Primary Data ◽

Real Economy ◽

Theoretical Concepts ◽

The Real

Purpose: The objective of this chapter is to discuss the effects of the Covid-19 pandemic on the international operations of firms, with a particular focus on foreign direct investment. Design/methodology/approach: The real economy perspective was adopted, whereby basic relationships in terms of the development of FDI flows and transactions worldwide were analyzed. In addition, primary data from a survey of internationally operating Polish firms were analyzed in order to shed additional light on the influence of the pandemic on international economic activity. In addition to formulating observations with regard to general patterns emerging from the data, an attempt has been made to outline the likely theoretical implications of the pandemic for FDI research. Findings: In the short term, there was a significant limitation of FDI, caused mainly by the introduction of lockdowns. In the middle and long run, the current crisis will likely translate into acontinued slowdown in FDI flows. On the other hand, as we may see from the early evidence analyzed in the chapter, the impacts on the international economic activity vary across locations at different levels of economic development, but also between different industries and business models. Research implications: From a theoretical perspective, we must note that in the short run the existing theoretical concepts can be helpful in explaining the present phenomena. However, in the long-term perspective a number of fundamental assumptions may require several revisions outlined in the chapter. Originality and value: The chapter includes an analysis of recent macro- and micro-level data on the effects of the pandemic on international business, along with forecasts for the post-pandemic period. Apart from the practical dimension of the analyzed primary and secondary data, the chapter also offers a number of theoretical implications.

Download Full-text

Combating Fiscal Fraud and Empowering Regulators

10.1093/oso/9780198854722.001.0001 ◽

2021 ◽

Keyword(s):

Money Laundering ◽

Tax Evasion ◽

Business Models ◽

Rapid Change ◽

Tax Avoidance ◽

Profit Shifting ◽

Tax System ◽

New Business ◽

International Tax ◽

The Impact

This book showcases a multidisciplinary set of work on the impact of regulatory innovation on the scale and nature of tax evasion, tax avoidance, and money laundering. We consider the international tax environment an ecosystem undergoing a period of rapid change as shocks such as the financial crisis, new business forms, scandals and novel regulatory instruments impact upon it. This ecosystem evolves as jurisdictions, taxpayers, and experts react. Our analysis focuses mainly on Europe and five new regulations: Automatic Exchange of Information, which requires that accounts held by foreigners are reported to authorities in the account holder’s country of residence; the OECD’s Base Erosion and Profit Shifting initiative and Country by Country Reporting, which attempt to reduce the opportunity spaces in which corporations can limit tax payments and utilize low or no tax jurisdictions; the Legal Entity Identifier which provides a 20-digit identification code for all individual, corporate or government entities conducting financial transactions; and the Fourth and Fifth Anti-Money Laundering Directives, that criminalize tax crimes and prescribe that the Ultimate Beneficial Owner of a company is registered. Working from accounting, economic, political science, and legal perspectives, the analysis in this book provides an assessment of the reforms and policy recommendations that will reinforce the international tax system. The collection also flags the dangers posed by emerging tax loopholes provided by new business models and in the form of freeports and golden passports. Our central message is that inequality can and has to be reduced substantially, and we can achieve this through an improved international tax system.

Download Full-text

The Permanent Establishment Concept In Double Tax Agreements Between Developed And Developing Countries: Canada/South Africa As A Case In Point

International Business & Economics Research Journal (IBER) ◽

10.19030/iber.v13i3.8591 ◽

2014 ◽

Vol 13 (3) ◽

pp. 539

Author(s):

Lee-Ann Steenkamp

Keyword(s):

South Africa ◽

Developing Countries ◽

Foreign Direct Investment ◽

Developing Country ◽

Direct Investment ◽

Tax Avoidance ◽

Tax Treaties ◽

Permanent Establishment ◽

Business Income

In this era of globalisation, developing countries have resorted to double tax agreements in order to attract foreign direct investment. The extent to which a countrys tax treaty policy favours developing countries or not depends upon the extent to which the country is prepared to adopt provisions from the UN model tax convention as opposed to the OECD model. Developing countries in particular should carefully consider the design of their tax treaties so as to effectively combat tax avoidance, without sacrificing foreign direct investment. To this end, the Canada/South Africa tax treaty is compared and contrasted with these two models. The concept of permanent establishment is reviewed in this context. It was found that the Canada/South Africa tax treaty is overwhelmingly based on the OECD model. This could indicate that South Africa has a deliberate tax treaty policy of ceding taxing rights to other countries. Thus, developing countries are seemingly unable or unwilling to make use of the UN model so as to retain greater source taxation. A number of recommendations are made to broaden the scope for the source taxation of business income in the developing country.

Download Full-text

ENGLISH UKRAINIAN LEXICON OF INTERNATIONAL TAX TERMS

10.31435/rsglobal/036 ◽

2021 ◽

Author(s):

Arne Ruben Edmund Jakobsson ◽

◽

Oksana Romanovna Stepanenko ◽

Valentyn Valentynovych Verovkin ◽

◽

...

Keyword(s):

Economic Activity ◽

Tax Planning ◽

Tax Law ◽

Profit Shifting ◽

The Future ◽

Planning Strategies ◽

International Tax

The proposed glossary is based on terms from the International Glossary of Tax Terms, the OECD Glossary of Tax Terms, the Glossary of Financial and Investment Terms and websites of the Tax Agencies. This dictionary contains the most commonly used terms in the tax field and has about 1600 terms that are of interest to both researchers and professionals in this field. We have paid special attention to the phenomenon that is currently only being implemented in Ukraine, namely the concept of “Base erosion and Profit Shifting” (BEPS), which refers to tax planning strategies that use gaps and inconsistencies in national and international tax law to artificially transfer profits to low- or zero-tax areas where economic activity is low or non-existent. In the future, it is planned to create a Swedish-Ukrainian dictionary of tax terms, which will contain more dictionary entries and help future professionals in this field.

Download Full-text

Nexus among electricity consumption, foreign direct investment and aggregate economic activity towards Nigeria’s economic performance: evidence from a trivariate causality model

Environmental Science and Pollution Research ◽

10.1007/s11356-021-17840-5 ◽

2022 ◽

Author(s):

Uche M. Ozughalu ◽

Uche C. Ogbuefi

Keyword(s):

Foreign Direct Investment ◽

Economic Performance ◽

Economic Activity ◽

Direct Investment ◽

Electricity Consumption ◽

Causality Model

Download Full-text

Permanent Establishment – New Concept

10.36250/00749.42 ◽

2019 ◽

pp. 445-456

Author(s):

César García Novoa

Keyword(s):

European Union ◽

New Economy ◽

Tax Law ◽

The European Union ◽

Traditional Definition ◽

Permanent Establishment ◽

International Tax ◽

Definition Of

The permanent establishment is an essential concept in International Tax Law. The traditional definition was based on the existence of a fixed place of business. At present, the new economy requires a change in the concept of permanent establishment. The topic of permanent establishment is based today on the so-called sufficient economic presence. The European Union is working on the definition of a permanent digital establishment.

Download Full-text

Revisiting the Case of Customary International Tax Law

International Community Law Review ◽

10.1163/18719732-12341459 ◽

2021 ◽

Vol 23 (1) ◽

pp. 79-103

Author(s):

Dirk Broekhuijsen ◽

Irma Mosquera Valderrama

Keyword(s):

International Law ◽

International Taxation ◽

Customary Law ◽

Tax Law ◽

Profit Shifting ◽

Customary International Law ◽

The Creation ◽

International Tax

Abstract Customary international tax law has traditionally not received a lot of acclaim in international tax law literature. However, the infrastructure of international tax law is becoming increasingly multilateral. The recent adoption of the Multilateral Instrument and the creation of the Inclusive Framework, two initiatives related to the OECD/G20 Base Erosion and Profit Shifting Project, have accelerated the width of cooperation on international tax matters. For that reason, the authors (re)consider the existence of customary international law in the area of international tax law. They conclude that, perhaps contrary to the intuition of tax lawyers, the evidence in favour of customary international tax law is building up. The question whether customary law exists within the area of international taxation is therefore not misplaced.

Download Full-text