Papers & Reports

This study examines corporate inversions, where multinational enterprises relocate their global ultimate owner (GUO) to another jurisdiction, complicating the identification of MNEs' country of origin and foreign subsidiaries. Using data from over 52,000 MNEs across 30 nations, the study hypothesizes that emerging market MNEs (EMNEs) and larger MNEs with extensive foreign networks are more likely to invert. The findings confirm this, highlighting differences between inverted and non-inverted MNEs, which can lead to sampling biases in research. The study suggests methodological adjustments to improve the accuracy of cross-country MNE analyses.

This article analyzes the potential negative effects of raising corporate tax rates, focusing on Kamala Harris's proposal to increase the U.S. corporate tax rate from 21% to 28%. It draws on examples from the Trump administration's tax cuts and international case studies from Ireland, Germany, and the UK. The article highlights the risks to business investment, job creation, and economic growth, noting that while higher taxes can increase public revenue, they may also discourage investment, reduce competitiveness, and hinder long-term growth. The analysis underscores the need for policymakers to balance revenue generation with maintaining a healthy business environment.

The peer review of the Action 13 Minimum Standard covers the three key areas under review: the domestic legal and administrative framework, the exchange of information framework, and the confidentiality and appropriate use of Country-by-Country (CbC) reports. This seventh annual peer review report reflects the outcome of the seventh review which considered all aspects of implementation. It contains the review of 138 jurisdictions which provided legislation or information pertaining to the implementation of CbC Reporting.

This article examines the European Union's (EU) external tax policies regarding 'uncooperative' tax jurisdictions, focusing on the role of the Court of Justice of the European Union (CJEU) case law, domestic tax laws of Member States, and the EU's blacklist of non-cooperative jurisdictions. By contextualizing the EU blacklist with relevant CJEU case law on anti-avoidance and anti-abuse provisions, the article highlights three key conclusions: the blacklist's soft law nature allows Member States to exploit anti-avoidance provisions; its failure to meet objectives is due to EU political dynamics; and it addresses symptoms rather than fundamental flaws in the international tax system.

This article addresses disputes between contracting states over the interpretation of terms in bilateral tax treaties, which can lead to conflicts over sovereignty and decision-making authority. Dr. Dhruv Janssen-Sanghavi reviews existing dispute resolution mechanisms and proposes a new approach that incorporates a greater role for the judiciary in resolving these conflicts.

The tax rules for foreign investors in the U.S. provide highly favorable treatment, with most foreign investors paying no U.S. tax on passive investments. These rules are based on the outdated assumption that the U.S. needs foreign capital to bridge the gap between domestic savings and investment. However, global financial capital is abundant due to regressive policies abroad, leading to excess foreign savings that have fueled unproductive consumption in the U.S., contributing to financial instability and a growing trade deficit. The article advocates for reforming U.S. inbound tax rules by increasing taxes on foreign investment to address these issues.

The OECD published this template that countries can use when delivering a risk assessment of a company’s transfer pricing position. The template is part of the OECD’s International Compliance Assurance Program, a voluntary program started in 2018 that multinational corporations can use to assess the risk of their transfer pricing positions with tax administrations.

Former European Central Bank President Mario Draghi addressed tax policy in his long-awaited report on the future of EU competitiveness. Draghi's suggestions include lowering and leveling energy taxation and using taxation measures strategically to reduce the cost of energy; introducing research and development tax incentives for fabless manufacturers active in chip design and foundries in selected strategic segments; and promoting a coordinated reduction of taxation on the labor income of low- to middle-income workers.

In this report, ICRICT argues that the UN subject-to-tax rule (STTR) is much more beneficial for countries than the OECD STTR, particularly for developing countries, both in terms of administration and potential additional revenue collection. ICRICT therefore recommends that developing countries introduce the UN STTR in their tax treaties.

This article highlights the significant growth of the black or shadow economy, especially in developing and least developed countries (LDCs), as identified by surveys from organizations like the World Bank, IMF, and ADB. Illicit financial flows, as noted by sources such as the Financial Secrecy Index and Tax Justice Network, have severely impacted government tax revenue. In response, governments are exploring innovative solutions, including cryptocurrencies, blockchain, artificial intelligence, and e-commerce, to address these challenges. The article also introduces the FDI return index to assess the economic performance of select developing and LDC countries. Foreign direct investment (FDI) is emphasized as a vital driver of macroeconomic development, fostering prosperity, sustainable growth, employment, and infrastructure improvements in these nations. By attracting FDI, countries can access external resources and expertise, bolstering their industries and global competitiveness.