The ITPF News Blog is managed by the students at the University of Florida Levin College of Law International Tax LLM Program.
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By: Stephanie Soong Johnston
Countries could not agree on a renovation of the international tax system in 2020 as planned, but they now have the blueprints that the OECD hopes will provide the foundation for an accord in 2021.
By: Stephanie Soong Johnston
The EU will hold off on unilateral plans to tax digital activity even though the OECD missed its 2020 deadline to reach agreement on a multilateral approach to modernize global tax rules.
By: Ryan Finley
Members of the United Nations’ subcommittee on taxing the digital economy have proposed a new treaty article allowing source-country taxation of digital services revenue, parting ways with the proposal currently under consideration at the OECD.
By: Andrew Goodall
The U.K. government may need tax rises of over £40 billion a year by 2024-2025 “just to stop debt spiraling upwards,” but now is not the time for increases, the Institute for Fiscal Studies (IFS) said.
Ending Corporate Tax Avoidance and Tax Competition: A Plan to Collect the Tax Deficit of Multinationals
By Kimberly A. Clausing, Emmanuel Saez, and Gabriel Zucman
Between 1985 and 2019, the global average statutory corporate tax rate has fallen from 49 percent to 23 percent, largely due to the rise of international tax competition. The biggest winners from globalization have received the largest tax cuts. In this paper we propose a solution to replace this race-to-the-bottom with a race-to-the-top. Multinational companies that have low effective tax rates in some foreign countries (what we call a “tax deficit”) would pay an extra tax in their home country. We explain how such a tax should be designed and how it could be collected. The ideal solution would be for all countries to jointly start collecting the tax deficit of their multinationals. We describe how defensive measures could be applied against countries refusing to take part in such an agreement, measures that could ultimately pave the way to global corporate tax coordination.
Good Tax Governance: International Corporate Tax Planning and Corporate Social Responsibility – Does One Exclude the Other?
By Ave-Geidi Jallai
International corporate tax planning and corporate social responsibility are topics that might not seem to have common ground at first sight. The aim of this research was to prove the contrary. This research addressed international corporate tax planning from various perspectives, such as regulation, ethics, business, and society. Not all forms of legal tax planning are considered (socially) legitimate anymore. Corporate tax planning is a complex issue: on the one hand, it is common corporate practice to keep costs low. On the other hand, corporations have to contribute to society and common goods by paying (corporate income) taxes as any other member of society. Not all kinds of corporate tax practices are (socially) illegitimate per se. Tax planning can be carried out in various forms. This research focused on tax planning activities that remain within the boundaries of the law (thus tax evasion is not part of this research).
By Alison Christians and Tarcisio Diniz Magalhaes
The world’s tax policy leaders are currently engaged in debate over who should tax the income streams produced with the help of cross-border regulatory coordination—the cooperative surplus over the gains that, in a counterfactual world, would be available if investments were confined to the domestic economy. To the extent there ever was a coherent relationship between consensus tax policy norms and the distribution of cooperative surplus, that relationship is now hopelessly skewed by real life factors, chief among them the rapid advancement of innovative technology that transcends physical boundaries of all kinds. The growing dissatisfaction of those on the wrong side of the skew had already initiated a rise in innovative ways to tax cooperative surplus when COVID-19 struck, significantly increasing the stakes for taxation and prompting yet more reform proposals. There are now at least fourteen strategies in play, each drawing varying levels of scrutiny, buy-in, and pushback. This Article examines the fourteen and argues that among them, those seeking to tax revenue flows at source have the best chance to alter the distribution of cooperative surplus in the immediate term, provided some formalistic tropes can be overcome.
By Ad van Doesum and Frank Nellen
In this article, the authors analyse the notion of ‘economic reality’ in EU VAT and how it is applied by the CJEU in its case law. The purpose is to clarify the concept of economic reality, to establish how it affects the taxation of transactions, and to what extent it should affect that taxation when taking into account the principle of legal certainty.
By Palma Joy Strand and Nicholas A. Mirkay
As a whole, the U.S. tax system (federal, state and local) since 1980 has served more and more to increase racialized wealth inequality. The tax system is today operating to entrench the system of advantage based on race that centuries of racial exploitation and unequal access to wealth created. As the future face of the nation becomes less White, the U.S. tax system as a whole and the anti-tax rhetoric that has fueled its shift from progressive to regressive are driving economic inequality and racial inequity. More deeply, the tax system is inhibiting broad-scale public investment in the primary resource of the future: human capital.
By: Chris Giles
The world’s rich nations have drafted a set of technical principles which would revolutionise the corporate taxation of multinational companies and could raise $100bn in extra tax revenues around the world.
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