Download or read book How Can the Multilateral Tax Treaty Solve the Treaty Shopping Issue written by De Roni Marco and published by LAP Lambert Academic Publishing. This book was released on 2015-08-25 with total page 60 pages. Available in PDF, EPUB and Kindle. Book excerpt: One of the currently main challenges of International Tax Law is addressing the treaty abuse deployed by various multinationals. These, leveraging on their freedom of movement and establishment, have the chance to refine and enlighten their tax burdens by involving third countries and their tax relationships, eventually achieving arguable and controversial profits. At this regard, seen the inefficiency of Bilateral Tax Treaties and the constraints arising from European Law, various legal devices were tested but none of them led to a proper solution. The countermeasure planned by the OECD may finally help resolving these issues: a Multilateral Tax Treaty. Yet, this still needs a proper tailoring, hence why an International Conference was announced for 2015. Therefore, what is a Multilateral Tax Treaty and can it face this challenge? How should it be drafted and which provisions should it contain? With this paper, I will try to provide an answer to these questions above and explaining how a possible failure could lead to a utterly grim scenario. Moreover, based on both current knowledge and personal prompts, I will try to hypothesise which provisions should this contain.

Download or read book How Can the Multilateral Tax Treaty Help Overcoming the Treaty Shopping Issue written by Marco De Roni and published by . This book was released on 2015 with total page 53 pages. Available in PDF, EPUB and Kindle. Book excerpt: One of the currently main challenges of International Tax Law is addressing the treaty abuse deployed by various multinationals. These, by taking advantage of their freedom of movement and establishment, have the chance to refine and enlighten their tax burdens by involving third countries and their tax relationship, therefore gaining arguable and controversial profits.This phenomenon has steadily grown, reaching nowadays the extent where many countries around the world are concerned given the fewer tax revenues. Amongst the most infamous business, newspapers reported Apple, Google, Ikea, Pepsi, Amazon and P&G, whose strategies proved being effective.What is now left to the countries is finding a strategy to curb abuses of law. At this regard, seen the inefficiency of Bilateral Tax Treaties, various legal devices were tested along the years but none of them led to a proper solution. Moreover, constraints arising from European Law may look like inflicting the coup de grace on the residual hope.Although it would look consequent that Tax Law cannot offer a proper antidote, the countermeasure planned by the OECD may finally help resolving these issues: a Multilateral Tax Treaty.With it, it would be possible to involve several countries in a single lawsuit, thus facilitating exchange of information and sharing of opinions.Yet, a Multilateral Treaty in this field, although wished for since almost two decades, still needs a proper tailoring to the current panorama with the right legal measures and this is why an International Conference was announced for 2015.Therefore, what is a Multilateral Tax Treaty and can it face this challenge? How should it be drafted and which provisions should it contain? Are there alternatives to it?With this thesis, I will try to provide an answer to these questions above and explaining how a possible failure could lead to an utterly grim scenario. Moreover, based on both current knowledge and personal prompts, I will try to hypothesise which provisions should this contain, by taking into account past successes and failures of similar treaties and legal principles of International law.

Download or read book Looking Ahead Inter National Law in 21st written by D.M. Broekhuijsen and published by Springer. This book was released on 2002-03-21 with total page 298 pages. Available in PDF, EPUB and Kindle. Book excerpt: Many states have set out to develop a multilateral tax instrument with the purpose of amending bilateral treaties in a quick and comprehensive fashion. The recent adoption by as many as a hundred jurisdictions of the Multilateral Convention to Implement Tax Treaty Related Measures to Prevent Base Erosion and Profit Shifting (the OECD Multilateral Instrument) is the most prominent step in this direction. This book provides not only a detailed analysis of the OECD Multilateral Instrument but also discusses in depth the far-reaching implications of the international tax reform currently under way. The author shows how the BEPS Project has merely unveiled the problems related to bilateral tax relationships and articulates initiatives to ensure the sustainability of a multilateral consensus. Drawing on the fields of international law, international relations, and political science, he develops a design strategy, complete with draft clauses, that fundamentally transforms the way states cooperate in the field of international tax, effectively addressing such problems as the following: – the need for collective action; – the problem structure of multilateral tax cooperation; – the relevance of the OECD Model Tax Convention and Commentaries thereon; – the place, position and operation of the OECD Multilateral Instrument; – non-OECD member countries; and – treaty shopping. The principled and pragmatic structural solution presented would allow policymakers to continuously adapt and respond to the rapidly evolving nature of the global economy. The author’s original research and his recommendations for future development of the topic offer deeply informed guidance to policymakers, practitioners and other tax professionals, and academics.

Download or read book A Multilateral Convention for Tax written by Sergio André Rocha and published by Kluwer Law International B.V.. This book was released on 2021-11-29 with total page 401 pages. Available in PDF, EPUB and Kindle. Book excerpt: The Multilateral Convention to Implement Tax Treaty Related Measures to Prevent Base Erosion and Profit Shifting (MLI) is the most forceful multilateral initiative to coordinate tax regimes on a worldwide basis since the dawn of modern income taxation over a century ago. This book evaluates two radically opposed viewpoints on the convention—a momentous and revolutionary paradigm shift versus a mechanism that merely continues an ongoing flow of limited policy coordination—with detailed investigations that bring to life the hopes and the realities of the current era of multilateral tax cooperation. Bringing together authors from national jurisdictions across the globe to scrutinize the MLI and its likely future ramifications, the book provides in-depth commentary and analysis in the following sequence: first, a comprehensive discussion of the design and goals of the MLI as a treaty and an institutional framework; second, an overview of the structure of the convention and its take-up across the globe to date; and third, the substantive implementation of the MLI with a wide range of country reports. Practice areas covered include tax law, international law, and international relations. The legal workings and implications of the MLI might still seem mysterious to those whose daily work is impacted by it, and there is as yet little jurisprudence regarding its legal nature or ultimate effect on the bilateral treaties coming within its scope. For these reasons, this pathbreaking book will be warmly welcomed by in-house counsel and law firms advising cross-border investors and firms; nongovernmental organizations involved in policy analysis and issue advocacy; researchers working on technical areas of international tax law; and lawyers interested in international policymaking, including the creation and diffusion of consensus-based fiscal and related regulatory norms across jurisdictions of differing development levels.

Download or read book MLI Made Easy written by Kuldeep Sharma and published by Kluwer Law International B.V.. This book was released on 2021-04-22 with total page 352 pages. Available in PDF, EPUB and Kindle. Book excerpt: The Multilateral Convention to Implement Tax Treaty Related Measures to Prevent Base Erosion and Profit Shifting (MLI) provides an innovative approach to enable countries to swiftly modify their bilateral tax treaties in order to implement measures developed in the course of the Base Erosion and Profit Shifting (BEPS) Project. MLI, the first successfully concluded multilateral tax treaty, provides jurisdictions with the tools they need to ensure that profits are taxed where economic activities generating the profits are performed, while at the same time giving businesses greater certainty. MLI Made Easy makes it easier to get a complete grasp of this swift but complex modification process of tax treaties. This first and only self-contained book offers an unmatched article-by-article discussion of the MLI with an abundance of practical examples, diagrams, and flowcharts to make the information easier to understand and apply. Focusing on measures to combat tax evasion and abuse of tax treaties arising due to artificial avoidance of a permanent establishment status, hybrid mismatch arrangements, and other aspects of taxation, the book includes an in-depth discussion of the following and more: how specific gaps in existing bilateral tax treaties are addressed by the MLI; positions taken by selected jurisdictions and their impact on treaties; compatibility clauses, notification clauses, opting-in mechanisms, alternative provisions, and reservations; experiences in the course of implementation of the MLI; misconceptions and lingering doubts in respect of various substantive and procedural provisions of the MLI; interaction between the principal purpose test and simplified limitation on benefits; improving dispute resolution; and meaning of the phrases ‘on or after’, ‘other taxes’, and interpretational issues in entry into effect provisions. Adopted by a majority of jurisdictions worldwide, MLI preserves the tax sovereignty of its Parties and has been successful in overcoming barriers to the conclusion of a worldwide multilateral tax treaty. Because this easy-to-use book immensely facilitates understanding and application of the treaty measures developed in the course of the BEPS Project, it will be of immeasurable use to practitioners and other professionals engaging in international taxation, as well as to taxation authorities and interested academics in any part of the world.

Download or read book A Multilateral Tax Treaty written by Dirk M. Broekhuijsen and published by . This book was released on 2018-03 with total page 298 pages. Available in PDF, EPUB and Kindle. Book excerpt: Many states have set out to develop a multilateral tax instrument with the purpose of amending bilateral treaties in a quick and comprehensive fashion. The recent adoption by as many as a hundred jurisdictions of the Multilateral Convention to Implement Tax Treaty Related Measures to Prevent Base Erosion and Profit Shifting (the OECD Multilateral Instrument) is the most prominent step in this direction. This book provides not only a detailed analysis of the OECD Multilateral Instrument but also discusses in depth the far-reaching implications of the international tax reform currently under way. The author shows how the BEPS Project has merely unveiled the problems related to bilateral tax relationships and articulates initiatives to ensure the sustainability of a multilateral consensus. Drawing on the fields of international law, international relations, and political science, he develops a design strategy, complete with draft clauses, that fundamentally transforms the way states cooperate in the field of international tax, effectively addressing such problems as the following: - the need for collective action; - the problem structure of multilateral tax cooperation; - the relevance of the OECD Model Tax Convention and Commentaries thereon; - the place, position and operation of the OECD Multilateral Instrument; - non-OECD member countries; and - treaty shopping. The principled and pragmatic structural solution presented would allow policymakers to continuously adapt and respond to the rapidly evolving nature of the global economy. The author's original research and his recommendations for future development of the topic offer deeply informed guidance to policymakers, practitioners and other tax professionals, and academics.

Download or read book A Global Treaty Override The New OECD Multilateral Tax Instrument and Its Limits written by Reuven S. Avi-Yonah and published by . This book was released on 2017 with total page 53 pages. Available in PDF, EPUB and Kindle. Book excerpt: The new OECD Multilateral Instrument to amend tax treaties (MLI) is an important innovation in international law. Hitherto, international economic law was built primarily on bilateral treaties (e.g., tax treaties and BITs) or multilateral treaties (the WTO agreements). The problem is that in some areas, like tax and investment, multilateral treaties proved hard to negotiate, but only a multilateral treaty can be amended simultaneously by all its signatories.The MLI provides an ingenious solution: A multilateral instrument that automatically amends all the bilateral treaties of its signatories. If the MLI succeeds, it can be a useful model in other areas, such as investment, where a multilateral agreement was not successful, but there is a growing consensus about the need to adjust the terms of BITs to address investor responsibilities and the definition of investment comprehensively.Whether the MLI will succeed remains to be seen. A recent estimate has suggested that the US will not agree to anything except the arbitration provision, and other OECD members may agree to only a limited set of provisions. On the other hand, the MLI may prove more appealing to developing countries because it enhances source-based taxation and limits treaty shopping.Even a limited MLI would be a step forward. The current tax reform proposals in the US pose a significant threat to the international tax regime Countries that wish to limit the damage would be wise to accede to the MLI this year and prevent a massive race to the bottom that could ensue if the US becomes (from the perspective of the rest of the world) a giant tax haven.

Download or read book MULTILATERAL INSTRUMENT FOR UPDATING THE TAX TREATY NETWORK written by NATHALIE. BRAVO and published by . This book was released on 2020 with total page pages. Available in PDF, EPUB and Kindle. Book excerpt:

Download or read book The Improper Use of Tax Treaties With Particular Reference to the Netherlands and the United States written by Stef Weeghel and published by Kluwer Law International B.V.. This book was released on 1998-03-27 with total page 302 pages. Available in PDF, EPUB and Kindle. Book excerpt: "With particular reference to the Netherlands and the United States."--T.p.

Download or read book Implementation in Practice of the Principal Purpose Test in the Multilateral Convention written by M.L. Gomes and published by . This book was released on 2018 with total page pages. Available in PDF, EPUB and Kindle. Book excerpt: This article discusses the implementation, operation and application of Article 7(1) of the 'Multilateral Convention', which contains provisions related to the prevention of treaty abuse, including treaty shopping, that correspond to changes proposed in the Base Erosion and Profit Shifting (BEPS) Action 6 Final Report. The wording of the comparable Covered Tax Agreements between the United Kingdom and China, India, Russia and South Africa, vis-à-vis the wording of Article 7(1) of the Multilateral Instrument (MLI), is analysed, where 'purpose provisions' are included with respect to specific benefits, generally royalties, interests and dividends, although there is no "catch-all provision". The provisions in these double taxation agreements might be replaced by the 'Principal Purpose Test' provision of Article 7(1). Nonetheless, mismatched choices and unpredictable asymmetries in practice will arise, resulting in further inconsistencies and complexities that may cause uncertainty about which tax treaty wording is of value. To overcome these issues, the compatibility clause in Article 7(2) of the MLI will come into play, supplemented by the lex posterior principle of the Vienna Convention on the Law of Treaties (VCLT).

Download or read book Responses to Tax Treaty Shopping written by David G. Duff and published by . This book was released on 2020 with total page 0 pages. Available in PDF, EPUB and Kindle. Book excerpt: Over the last 40 years, the world has experienced exponential growth in international trade and investment, as well as the number of bilateral tax treaties which now number roughly 3,000. As the globalization of economic activity has greatly increased opportunities for tax avoidance and evasion, so also has the expansion of the international tax treaty network increased opportunities for taxpayers to take advantage of domestic tax rules and bilateral tax treaties by arranging their affairs in ways that reduce taxes otherwise owing or eliminate them altogether. Regarding many of these arrangements as abusive treaty shopping, the OECD and several member jurisdictions have adopted various responses to this phenomenon, involving the interpretation of treaties as the well as the introduction and application of anti-avoidance rules in domestic law and tax treaties. This paper reviews and evaluates these responses to treaty shopping, providing a comparative examination of developments in various jurisdictions. Part II discusses the concept of treaty shopping, defining this term for the purposes of this analysis, providing a few examples for illustrative purposes, and explaining why treaty shopping is problematic on policy grounds. Part III considers interpretive responses to abusive treaty shopping, examining recent cases and commentary on the concepts of “residence” and “beneficial ownership” as well as the existence of an anti-abuse principle inherent in tax treaties and international law. Part IV addresses specific and general anti-avoidance rules, both domestic rules and their relationship to tax treaties as well as anti-avoidance rules contained in tax treaties themselves. Based on this analysis, Part V provides general conclusions.

Download or read book A Multilateral Instrument for Implementing Changes to Double Tax Treaties Problems and Prospects written by D. Kleist and published by . This book was released on 2016 with total page pages. Available in PDF, EPUB and Kindle. Book excerpt: The OECD has initiated the development of a multilateral instrument intended to swiftly implement tax treaty changes agreed on as part of the base erosion and profit shifting (BEPS) Project. This article describes the background of the multilateral instrument (MLI) and aims to discuss some difficulties that need to be overcome if the instrument is to become a reality. Furthermore, it analyses what the instrument may mean in the short and long term.

Download or read book The Nordic Multilateral Tax Treaty as a Model for a Multilateral EU Tax Treaty written by Marjaana Helminen and published by . This book was released on 2013 with total page pages. Available in PDF, EPUB and Kindle. Book excerpt:

Download or read book International Tax Policy and Double Tax Treaties written by Kevin Holmes and published by IBFD. This book was released on 2007 with total page 433 pages. Available in PDF, EPUB and Kindle. Book excerpt: Explains the concepts that underlie international tax law and double tax treaties and provides an insight into how international tax policy, law and practice operate to ultimately impose tax on international business and investment.

Download or read book A Model Tax Treaty for the Asian Pacific Region written by Richard J. Vann and published by . This book was released on 2010 with total page 0 pages. Available in PDF, EPUB and Kindle. Book excerpt: The publication of the OECD Model tax treaty in 1977 marked 50 years of development. The Model seeks to remove international tax barriers by reconciliation at the interface of tax systems and has produced a bilateral network because it is generally considered that the diversity of tax systems around the world means that it is not possible to have a general multilateral treaty. Despite its success, the Model is plagued by problems, particularly those arising from the taxation of transnational corporations and corporate groups. The major issue is whether separate taxation or consolidated group taxation should be applied to the members of a corporate group across national boundaries. The Model adopts separate taxation while the international tax system moves directly and indirectly towards consolidation. The result is that the Model is increasingly inefficient as it creates biases in taxpayers' economic behaviour. The schedular structure of tax treaties with different tax regimes applied to different types of income encourages taxpayers to recharacterise income to obtain the best tax result. The problem is made worse by the requirement of reciprocity in tax treaties even where the tax systems of the treaty partners are quite different and effective reciprocity is not achieved by formal reciprocity. These difficulties are most acute in the corporate group and similarly the practice of treaty shopping through the use of conduit corporations is caused by the separate taxation of the members of a group. International tax problems are also arising outside the OECD Model, that is, the Model fails to deal directly with or is inappropriate for them as the issues were not significant when the Model originated. The practice of thin capitalisation and the use of tax havens have produced legislative responses that adopt consolidation tax methods and contradict the basic structure of tax treaties. Yet the Model has little or nothing to say directly on these matters and may even be an impediment to desirable development of national tax laws. Failure to adapt the Model means that countries are explicitly or implicitly changing their domestic tax laws in ways that conflict with their tax treaty obligations. Failure to develop responses to emerging issues is largely to be explained by the converse relationship between the growth of and change to the bilateral tax treaty network - the larger the network the more difficult it is to change because of the increasing number of treaties that need to be renegotiated. Hence the OECD is resorting to change by reinterpretation but this has only marginal effects and leads to tortuous linguistic gymnastics. Judged from a trade perspective the network seems larger than is necessary. Moreover, individual nations, especially smaller ones, find their treaty policy choices restricted in negotiations by most favoured nation status protocols so that it is often not possible to produce the best solution in a particular bilateral negotiation. By contrast the US regularly breaches its treaties in pursuit of its policy goals. The search for alternatives to the current bilateral network usually leads to suggestions for multilateral treaties, but as the diversity of tax systems that is the cause of bilateralism has not been directly addressed by the OECD Model, it is not possible for the bilateral network simply to evolve into a multilateral treaty. Such multilateral treaties as exist are regional and involve countries with similar economic and cultural backgrounds so that the necessary degree of uniformity is already present. Since the rest of the world remains in bilateral mode the multilateral treaties are likely to mimic the OECD Model and hence not address its problems. It seems likely that the OECD may soon achieve success with a worldwide multilateral treaty network in the administrative assistance area but again this can be explained by the requisite degree of uniformity of tax administration laws and international problems. Hence the desire for a multilateral treaty often expressed by the drafters of model treaties can be regarded as a call for more uniformity in tax systems. Such uniformity may be possible in the context of trade blocs which reconnect tax to trade issues. The European Community has despite many difficulties and setbacks made considerable progress in this area but more with sales taxes rather than the income tax which is the major concern of tax treaties. The existing bilateral network may be one reason why the income tax has not been given as much attention in Europe. One problem of regional moves to uniformity is that they may operate as barriers to rather than promoters of worldwide tax uniformity because of the political nature of the compromises involved. A more flexible approach to international tax problems may be possible in the context of an international tax institution structured like the GATT. The minimum requirements for such an institution are a power to determine disputes among members and to act independently as a catalyst for promoting changes to international tax rules. The advantage of this approach is the flexibility that it offers. At the beginning it would only be necessary to have some minimal generally binding rules such as an obligation to relieve double taxation and the conferring of most favoured nation status on signatories. Nations could then adopt from a menu of options a greater range of undertakings such as tax rate ceilings (without reciprocity) and non-discrimination in much the same way as tariff undertakings and side agreements operate in the GATT. It would be possible for rules to be more general than those in the OECD Model because of the interpretive role of the international institution. Within such a structure very different solutions could be adopted to the tax problems caused by transnational corporations such as an international tax base that would eliminate current income recharacterisation, transfer pricing, treaty shopping, thin capitalisation and controlled foreign corporations problems. The world does not need another model bilateral tax treaty and this approach is not recommended for the Asian-Pacific region. What is needed is another mode for the development of international tax relations. Yet the success of the bilateral tax treaty network means that nations will not move on a worldwide basis to a GATT style institutional alternative without some confidence that it will be an improvement. Hence such an initiative will need first to be undertaken on a regional basis. The Asian-Pacific region provides an ideal proving ground because it is not so preoccupied as Europe, Africa and the Americas with other issues such as trade blocs, the conversion of centrally planned to market economies and third world debt. Moreover, it is time that the region exerted an influence on world affairs as befits its economic status, and the need for another solution to international tax problems provides the opportunity to do so.

Download or read book A New Tax Treaty for a New World the Multilateral Convention to Implement Tax Treaty related Measures to Prevent Base Erosion and Profit Shifting written by J. Malherbe and published by . This book was released on 2018 with total page pages. Available in PDF, EPUB and Kindle. Book excerpt: According to the BEPS Action 15 Final report, a Multilateral Instrument (MLI) was opened for signature in 2017 through which jurisdictions could amend their bilateral conventions for the avoidance of double taxation to insert new clauses. Some were part of a minimum standard: a preamble and a principle purpose test (PPT) designed to avoid non-taxation and treaty abuse; a mutual agreement procedure (MAP). Others are subject to innovations, such as artificial avoidance of a PE status or options, such as limitation on benefits or arbitration. This article comments on those clauses and their status.

Download or read book The Multilateral Convention to Implement Tax Treaty Related Measures to Prevent Base Erosion and Profit Shifting written by P. Baker and published by . This book was released on 2017 with total page pages. Available in PDF, EPUB and Kindle. Book excerpt: This current note discusses the new Multilateral Convention to Implement Tax Treaty Related Measures to Preven Base Erosion and Profit Shifting (MLI), signed on 7 June 2017 in Paris.