Tax planning structures used by some MNEs have become the bane of policymakers nowadays, at the OECD as well as the EU level, since recent statistics revealed public budgets were deprived of billions of euros. 0Within the context of recent developments in the tax arena, this book examines the anti-abuse measures that already exist in various countries and scrutinizes the effectiveness of these measures in countering aggressive tax structures. This work can be considered complementary to the reports issued or to be issued by the OECD, and to the recent activity at the EU level, as it provides an in-depth analysis of what is already happening in practice in various countries when they encounter abusive tax structures. It also highlights the challenges implicit in the recommended measures in the draft reports issued by the OECD up until 1 May 2015, with some exceptions. The book provides the reader with an analysis of the most common strategies against tax avoidance; the key concepts in international tax structuring, such as the use of permanent establishments and the exploitation of transfer pricing rules; and the intricacies of anti-abuse measures that counter tax structuring schemes used for financing activities and for selected business models, specifically related to supply chain management, IP migration and exploitation, the digital economy and holding companies.

Recent tax developments aimed at mitigating the possibilities of base erosion and profit shifting are expected to increase the importance and popularity of tax incentives. This is due to the fact that states will want to remain competitive on the international stage and multinational enterprises will look for other opportunities to minimize their tax liabilities.0This book seeks to answer the following essential questions, from both a practical and an academic perspective:0- Will tax incentives be the 21st century tool for tax planning structures?0- Will states need to introduce more tax incentives in the future in order to be more competitive?0- What are the effects of the anti-abuse measures adopted by the EU Member States and recommended by the OECD on tax incentives?0- What are the challenges of securing the use of tax incentives?0- What new tax policy challenges will tax incentives bring about? 00This book answers these questions by analysing selected tax incentives that are commonly promoted by both developed and developing states, particularly those tax incentives that are of relevance to corporate income taxation.

The power of a country to freely design its tax system is generally understood to be an integral feature of sovereignty. However, as an inevitable result of globalization and income mobility, one country’s exercise of tax sovereignty often overlaps, interferes with, or even impedes that of another. In this collection of essays, internationally respected practitioners and academics reveal how the OECD’s Base Erosion and Pro t Shifting (BEPS) initiative, although a major step in the right direction, is insuf cient to resolve the tax sovereignty paradox. Each contribution deals with different facets of a single topic: How tax sovereignty is shaped in a post ,BEPS world. The contributors provide in ,depth analysis of such relevant issues as the following: hy multilateral cooperation and soft law consensus are the preferred solutions to a loss of autonomy over national tax policy; – how digital commerce has upended traditional notions of source and residence; – why residence and source continue to be the two essential building blocks of tax sovereignty and the backbone of the international tax system; – how developing countries can take advantage of the new international tax architecture to ensure that their voices are truly shaping the standards; and – transfer pricing reform. Collectively, the authors provide an authoritative commentary on the necessary preconditions for exercising the power to tax in today’s world. Their perspectives and recommendations will prove of great value to all policymakers, legislators, practitioners, and academics in the international taxation arena.

This report presents studies and data available regarding the existence and magnitude of base erosion and profit shifting (BEPS), and contains an overview of global developments that have an impact on corporate tax matters.

The topics of double non-taxation and hybrid entities have acquired a particular importance in a context where transformations within the tax world seem to be leading to an international commitment most materially manifested in the OECD Base Erosion and Profit Shifting (BEPS) project. In what is the first systematic in-depth critique of the BEPS Action Plan 2 with regard to hybrid entities, this timely book provides a critical review of the OECD’s approach and proposes a deeply informed alternative method based on the tax policy aims of simplicity, coherence and ease of administration. The author analyses the interaction between the double non-taxation outcome and the use of hybrid entities in an approach not strictly linked to any specific tax jurisdiction. To this end, the analysis includes case studies and examples from a range of jurisdictions emphasizing the international tax context, including the application of tax treaties. Among the seminal matters covered are the following: – foundations of the concepts of double non-taxation and hybrid entities, absent of the specific limitations of domestic tax legislation; – extensive analysis based on the rules of characterization of foreign entities for tax purposes in the United States, Spain, Denmark and Germany, as well as on the Poland/United States and Canada/United States tax treaties; – detailed analysis on the implications of Article 1(2) OECD Model Tax Convention and Article 3(1) Multilateral Instrument, especially having in mind the position of developing (source) countries; and – EU tax law as part of the international context, including an extensive analysis on the EU Anti-Tax Avoidance Directive (ATAD) I and ATAD II. Detailed comparisons between the author’s proposal and other existing rules elucidate common points and deviations. If merely for its unparalleled clarification of the issues, this book will prove of immeasurable value to practitioners, tax authorities, policymakers and academics concerned with international tax law. Beyond that, as an authoritative guide that promises to reorient the discussion to what really matters in the debate regarding double non-taxation and hybrid entities, this analysis elaborates solutions applicable to a generality of cases worldwide, and thus hugely promotes the urgent quest for alternative solutions.

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.