scholarly journals INTER-NATION EQUITY REVISITED

2020 ◽  
Vol 12 (1) ◽  
pp. 58-88
Author(s):  
Ivan Ozai
Keyword(s):  
Tax Policy ◽  
Policy Design ◽  
International Taxation ◽  
Recent Attempt ◽  
Tax Base ◽  
Poverty And Inequality ◽  
International Tax ◽  
The One ◽  
International Tax Policy ◽  
Degree Of Redistribution

States are on the verge of a new form of global competition. Some have taken unilateral measures to tax multinational profits that they would typically not be able to tax, at least not according to conventional international tax concepts and rules. Others have threatened to retaliate with economic countermeasures to protect their tax base and corporate residents. The recent attempt of the OECD to build consensus for a global tax compact has so far proven unsuccessful due to broad disagreement about how taxing rights should be equitably distributed between countries. As policymakers and tax scholars increasingly call into question long-standing theories of international taxation, the concept of inter-nation equity plays a pivotal role as a guiding principle in determining how to divide the international tax base among states. Inter-nation equity is one of the most ubiquitous concepts appearing in international tax policy discussions and yet one of the most understudied in tax scholarship. This Article introduces a comprehensive normative analysis of inter-nation equity by discussing how the concept should reconcile the two primary goals of international allocation of taxing rights: on the one hand, the concern of states to preserve their tax sovereignty and, on the other hand, the need to promote some degree of redistribution to address the challenges of global poverty and inequality. This Article further explains how a similar notion of inter-nation equity has developed in other areas of international law and discusses some practical implications for tax policy design.

A Sceptic’s Guide to Justice in International Tax Policy

2019 ◽  
Vol 32 (02) ◽  
pp. 499-512
Author(s):  
Laurens van Apeldoorn
Keyword(s):  
Distributive Justice ◽  
Tax Policy ◽  
Global Justice ◽  
The State ◽  
International Taxation ◽  
Recent Book ◽  
Moral Norms ◽  
Multilateral Cooperation ◽  
International Tax ◽  
International Tax Policy

AbstractWhat, if any, are the moral norms governing the international taxation regime if the sceptic is right to think that considerations of distributive justice do not apply beyond the state? I sketch an answer to this question by examining Tsilly Dagan’s illuminating recent book International Tax Policy: Between Competition and Cooperation. In her work, Dagan identifies the position of Thomas Nagel, an influential global justice sceptic, as predominant among commentators in legal scholarship and policy debates on international taxation. According to Nagel, multilateral cooperation is appropriately conceived as a bargain between mutually self-interested states. In tracing the implications of his position for international tax policy Dagan argues that even a sceptic like Nagel is committed to identifying some considerations of distributive justice beyond the state to ameliorate the harmful effects of tax competition. In response I argue that Dagan is correct to claim that the global justice sceptic is committed to seeing cooperation in international tax policy as constrained by moral norms, but that these norms are what Nagel calls humanitarian duties rather than duties of justice. I establish that Dagan’s argument that Nagel is committed to a duty of justice to promote distributive justice abroad faces some significant obstacles and suggest that Dagan can ground her argument in a humanitarian duty that Nagel does accept. The upshot of the argument is that even if the sceptic is right to think that considerations of distributive justice do not apply beyond the state, multilateral tax cooperation is governed by a duty of states to prevent human rights deficits where they can.

Community Interests in International Taxation

2018 ◽  
Author(s):  
Tsilly Dagan
Keyword(s):  
Tax Competition ◽  
Tax Policy ◽  
Conventional Wisdom ◽  
International Taxation ◽  
Collective Good ◽  
Market Failures ◽  
Double Taxation ◽  
Second Best ◽  
International Tax ◽  
International Tax Policy

This chapter describes the multilateral efforts regarding four key concerns of the international community: Prevention of double taxation, fighting “harmful tax competition,” sharing of information, and the “gaps and frictions” between the tax systems of various countries noted by the recent BEPS report. It then asks what, in fact, constitutes the community’s interest in the international tax area, arguing that where tax policy is concerned, there is no clear “textbook answer” regarding the best way to tax internationally. The chapter criticizes two proxies which are often implicitly endorsed in order to evaluate international tax policy: Cooperation among states, and the prevention of market failures. It argues that cooperation, contrary to conventional wisdom, is neither a goal in itself nor is it a good enough proxy for the collective good, and that the elimination of market failures, although indisputably beneficial, may raise a second-best problem.

Tax and Human Rights

2019 ◽  
pp. 99-114
Author(s):  
Mitchell A. Kane
Keyword(s):  
Developing Countries ◽  
Human Rights ◽  
Tax Policy ◽  
Developed Countries ◽  
International Taxation ◽  
Developed Country ◽  
Basic Source ◽  
International Tax ◽  
The One ◽  
Incidence Analysis

This chapter assesses the rightful claims of developed and developing countries to portions of the “international tax base.” Existing revenue in developed country coffers and incremental revenue from possible reform of the international tax system are not substitutes. There is a massive difference between developed countries redirecting a portion of existing revenue toward the redress of human rights shortfalls in developing countries on the one hand, and a restructuring of the basic understanding of international tax entitlements such that developing countries have a superior claim to revenues as their own in the first instance on the other. The chapter then proposes three possible ways in which we might rethink tax policy: a recasting of the basic source-residence dichotomy that deeply pervades the existing approach to international taxation; a consideration of tax policy with an eye to duties that nations may hold with respect to one another; and a rethinking of the role of corporate incidence analysis in tax policy.

The Importance of Lawyers in International Tax Policy Design and Development: An Exploration and Extension of the Legal-Economic Literature

2019 ◽  
Author(s):  
Ann Kayis-Kumar
Keyword(s):  
Tax Policy ◽  
Multinational Enterprises ◽  
Policy Design ◽  
Legal Analysis ◽  
Tax Legislation ◽  
Theoretical Approaches ◽  
Linear Optimisation ◽  
International Tax ◽  
National Tax ◽  
International Tax Policy

The advent of the global digital economy has increased opportunities for aggressive tax planning by multinational enterprises (‘MNEs’). Governments are increasingly faced with the competing objectives of remaining internationally competitive and encouraging foreign investment while also protecting their national tax bases. Two key trends have had a significant impact on the international tax debate. First, over the past three decades, the rise of MNEs and the prominence – and dominance – of inter-company trade as a proportion of global trade has fundamentally shifted the influence of individual governments’ tax policies. Second, even though corporate tax policy has traditionally been a field dominated by economists, there is now a shift towards ‘politicisation’ of the debate. The focus of this article is on the importance of legal practitioners and scholars in assisting with meaningful reform at the intersection of these two trends – and examining alternative theoretical approaches to tax policy. In doing so, this article also bridges two disciplines by combining legal analysis with linear optimisation modelling (to simulate a tax-minimising MNE’s behavioural responses to both existing and proposed tax legislation). Ultimately, it is hoped that this research will present a platform for further discussion on the tax treatment of cross-border intercompany transactions, and facilitate the development of improvements to both the tax law design and drafting.

Main Tax Policy Matters for Establishing Chile as a Regional Operative Investment Hub

2021 ◽  
Vol 22 (3) ◽  
Author(s):  
Hugo Hurtado ◽  
Jaime Del Valle
Keyword(s):  
Foreign Investment ◽  
Tax Policy ◽  
Policy Design ◽  
Oecd Countries ◽  
Policy Instrument ◽  
Holistic View ◽  
Regional Approach ◽  
Key Policy ◽  
Past Experiences ◽  
International Tax Policy

Unlike other OECD countries, Chile has not yet established a uniform tax policy toward foreign investment. Moreover, Chile had past experiences of unsuccessful legislation on specific exempted investment vehicles created with the purpose of establishing the country as a hub or platform for foreign investment. An effective international tax policy design requires taking a holistic view of the challenges and their corresponding solutions. As a country’s tax regime is a key policy instrument that may negatively or positively influence investment, Chilean tax policy is being oriented in this regard. This Article reviews the progress of those projects and current legislation, compares other OECD countries’ experiences in this matter, analyzing the main facts or elements to consider upon deciding the relevant tax policy, and finally proposes a tax regime that could make Chile more competitive when attracting foreign operative investment, focused on a more regional approach. Accordingly, this Article also intends to serve as guide or help to be considered by regulators on the hard road of designing tax standards. 

scholarly journals Offshore financial activity and tax policy: evidence from a leaked data set

2016 ◽  
Vol 36 (3) ◽  
pp. 457-488 ◽  
Author(s):  
Paul Caruana-Galizia ◽  
Matthew Caruana-Galizia
Keyword(s):  
Tax Policy ◽  
Control Group ◽  
Data Set ◽  
Financial Activity ◽  
Interest Income ◽  
Beneficial Ownership ◽  
International Tax ◽  
International Tax Policy

AbstractWe assess the European Union’s (EU) most significant international tax policy. The 2005 Tax and Savings Directive obliges cooperating jurisdictions to withhold tax or report on interest income earned by entities whose beneficial owner is an EU resident. As the Directive applies only to beneficial ownership in cooperative jurisdictions, it can be circumvented by transferring ownership to a non-EU resident or company or by transferring the entity to a non-cooperative jurisdiction. Using a database on individual offshore entities leaked from two firms in 2013, we compare the response of EU-owned entities with a control group of non-EU-owned entities. We show that the growth of EU-owned entities declined immediately after the Directive’s implementation, whereas that of non-EU-owned entities remained stable. We observe the substitution of EU ownership for non-EU ownership, as well as the substitution of cooperative for non-cooperative offshore jurisdictions. This calls for anti-evasion policies that are broader in scope and scale.

scholarly journals What is Unilateralism in International Taxation?

AJIL Unbound ◽  
2020 ◽  
Vol 114 ◽  
pp. 260-264
Author(s):  
Wei Cui
Keyword(s):  
International Business ◽  
International Taxation ◽  
The Other ◽  
Profit Shifting ◽  
High Stakes ◽  
Political Resources ◽  
International Coordination ◽  
International Tax ◽  
The One

The Organisation for Economic Co-Operation and Development (OECD) recently emerged as the site of unprecedented, multilateral, and seemingly high-stakes negotiations about the future of international business income taxation. Judging by the political resources deployed in these negotiations, international tax has entered unchartered territory. Ruth Mason offers a timely and balanced portrayal of the OECD process so far. But explanations of this process remain eminently contestable. On the one hand, international institutions that address externalities from uncoordinated actions and produce mutual benefits for participating nations can be highly stable. On the other hand, the OECD has struggled, whether in its Base Erosion and Profit Shifting (BEPS) and post-BEPS initiatives or during the pre-BEPS era, to articulate the goals for which international coordination in taxation is needed. By many accounts, recent discussions at the OECD are motivated mainly by the desire to stop foreign imposition of taxes on U.S. companies, or, as the other side of the same coin, to avert the wrath of the single hegemonic power in international tax. What is the best characterization of this conflict? I believe that understanding the underlying subject matter for international coordination, as opposed to merely the institutions that might facilitate such coordination, is required for identifying the coming transformation of international tax.

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