Author: Arthur Andersen & CoPublisher:
ISBN:
Category : Income tax
Languages : en
Pages : 46
Book Description
Tax Sparing
Author: Arthur Andersen & CoPublisher:
ISBN:
Category : Income tax
Languages : en
Pages : 46
Book Description
Tax Sparing A Reconsideration
Author: OECDPublisher: OECD Publishing
ISBN: 9264162437
Category :
Languages : en
Pages : 89
Book Description
This report examines the practices of Member countries with regards to tax sparing and explains why Member countries have become more reluctant to grant tax sparing in treaties. It also provides a number of suggested "best practices" on the design of tax sparing provisions in tax treaties.
The Tax Sparing Mechanism and Foreign Direct Investment
Author: Na LiPublisher:
ISBN: 9789087224837
Category :
Languages : en
Pages :
Book Description
Tax Sparing
Author: Organisation for Economic Co-operation and DevelopmentPublisher: Org. for Economic Cooperation & Development
ISBN:
Category : Business & Economics
Languages : en
Pages : 100
Book Description
This report examines the practices of Member countries with regards to tax sparing and explains why Member countries have become more reluctant to grant tax sparing in treaties. It also provides a number of suggested "best practices" on the design of tax sparing provisions in tax treaties.
International Competitiveness, Tax Incentives, and a New Argument for Tax Sparing
Author: Michael S. KnollPublisher:
ISBN:
Category :
Languages : en
Pages : 40
Book Description
Tax sparing occurs when a country with a worldwide tax system grants its citizens foreign tax credits for the taxes that they would have paid on income earned abroad, but that escapes taxation by virtue of foreign tax incentives. The supporters of tax sparing argue that it is a form of foreign aid, an obligation owed to developing countries, and a legitimate means of improving the competitiveness of resident investors. Tax sparing, however, has long been opposed by the United States on the grounds that it is an expensive and problematic concession to developing countries, inconsistent with basic and fundamental tax principles, and an inappropriate mechanism for improving the competitiveness of resident investors. The U.S. position appears to be carrying the day as tax sparing has been on the wane.In contrast with the emerging consensus, I offer a new argument for tax sparing. Drawing on the literature on implicit taxes, I argue that tax incentives produce implicit taxes. From the perspective of the investor, implicit taxes are as real as traditional explicit taxes. Thus, tax sparing is best viewed as extending the foreign tax credit to include implicit taxes. Accordingly, I argue that tax sparing is consistent with the notion of a single level of taxation and the foreign tax credit. I also argue that tax sparing is necessary to prevent domestic investors from being disadvantaged by foreign tax incentives. In addition, I show that such arguments support a greatly expanded form of tax sparing. Finally, I demonstrate that the tax sparing credit, as currently calculated, will usually exceed the implicit tax paid and propose an alternative method of calculating the credit that will place investors residing in countries with worldwide tax systems on par with other investors.
Tax Sparing
Author: Publisher:
ISBN:
Category : Investments, Foreign
Languages : en
Pages : 25
Book Description
Taxation of U.S. Corporations Doing Business Abroad
Author: Alan Winston GranwellPublisher:
ISBN:
Category : Business & Economics
Languages : en
Pages : 116
Book Description
Tax Sparing : a Needed Incentive for Foreign Investment in Low-income Countries Or an Unnecessary Revenue Sacrifice?.
Author: K. BrooksPublisher:
ISBN:
Category :
Languages : en
Pages :
Book Description
Low-income countries often offer tax incentives to induce foreign investment, but the effectiveness of these measures may he limited by the domestic tax practices of investors' high-income home countries. Most high-income countries provide a tax credit for the amount of tax paid to a foreign jurisdiction on the international profits of resident companies or individuals. Where no tax, or reduced tax, is paid to the foreign jurisdiction because of a tax incentive, the result is that the investor pays the same amount of tax they would have paid in the absence of the tax incentive, but simply pays a larger proportion of it to the resident (high-income) state. In other words, the tax incentive offered by the low-income country has operated as a revenue transfer from the treasury of the low-income state to the treasury of the high-income state. A tax sparing provision, included in a tax treaty negotiated between the two countries, preserves the tax incentive by reducing the tax owed to the high-income country by the amount of tax that would have been paid to the low-income country, but for the tax incentive. In theory, by incorporating tax sparing provisions into tax treaties with low-income countries, high-income countries assist those countries in their efforts to attract investment by protecting their ability to offer effective tax incentives. However, there has been much de-bate over whether these provisions are effective in practice. The author outlines the history of tax sparing provisions in Canada, Australia, the U.K. and the U.S., and illustrates the early reluctance of these countries to follow the recommendations of international bodies regarding tax sparing. The OECD has opposed these incentives and has concluded they have long-term shortcomings: they are vulnerable to abuse, may erode tax bases and may fail to achieve their purported goal -- attracting investment to low-income countries. The author argues that despite some recent empirical evidence to the contrary, tax sparing provisions are ineffective in preserving tax incentives designed to attract foreign investment. She concludes that tax sparing provisions used to support tax incentives are an ill-designed mechanism through which to improve social and economic conditions in low-income countries. Cognizant that some low-income countries will continue to seek tax sparing provisions in their tax treaties, the author recommends design features of those provisions that should maximize their contribution to the development of the low-income countries while minimizing the potential for their abuse.
The U.S. Policy on Tax Sparing Credit
Author: Yong-sŏk OPublisher:
ISBN:
Category : Foreign tax credit
Languages : en
Pages : 114
Book Description
Special Features of the UN Model Convention
Author: Anna BinderPublisher: Linde Verlag GmbH
ISBN: 3709410401
Category : Law
Languages : en
Pages : 582
Book Description
Detailed research on the UN Model Convention’s unique features The UN Model Convention has a significant influence on international tax treaty practice and is especially used by emerging and developing countries as a starting point for treaty negotiations. Driven by the aim to achieve consistency in the international tax treaty practice, the structure and content is, to a large extent, similar in the UN Model and the OECD Model. However, whereas the OECD has historically focused its efforts on issues mainly relevant for developed countries, the UN Tax Committee has continuously attempted to specifically take into account tax treaty policies for developing countries when drafting and amending the UN Model Convention. Compared to the OECD Model Convention, the UN Model Convention aims at giving more weight to the source principle. Popular examples are the PE definition in the UN Model which provides for a lower threshold than Article 5 of the OECD Model or Article 12A on Fees for Technical Services which has been introduced with the latest amendment of the UN Model Convention 2017 and allows for a withholding tax to be levied on payments to non-residents when the payer of the fee is a resident of that contracting State irrespective of where the services are provided. Interestingly, in the discussions of the tax challenges arising from the digitalization of the economy, the OECD and the G20 are also exploring options to allocate more taxing rights to the jurisdiction of the customer and/or user, i.e., the ‘market jurisdictions’. As this has traditionally been the focus of the UN Model Convention, its unique features and developing countries’ practices could be taken into account when exploring new nexus rules that are not constrained by the physical presence requirement. This book contains the master’s theses of the full-time LL.M. program 2018-2019 for which ‘Special Features of the UN Model Convention’ has been chosen as the general topic. With this book, the authors and editors do not aim at discussing each article of the UN Model Convention but rather focus on the unique features of the UN Model Convention, which are explored in detail. This is supplemented with an evaluation of the function and relevance of the UN Tax Committee in the international tax policy discussion and with an analysis of the influences of the OECD's BEPS project on the UN Model.
