The Base Erosion and Profit Shifting (BEPS) Project was initiated by the Organization for Economic Co-operation and Development and G20 in 2013 to address tax avoidance schemes used by... Show moreThe Base Erosion and Profit Shifting (BEPS) Project was initiated by the Organization for Economic Co-operation and Development and G20 in 2013 to address tax avoidance schemes used by multinational enterprises (MNEs). Drawing on interviews with a range of tax policy stakeholders, this book analyses the BEPS Project’s impact on developing countries’ approaches to combatting international tax avoidance, developing novel typologies to categorize policies and conducting case studies in Colombia, India, Nigeria, and Senegal. Contrary to public communication surrounding it, the BEPS Project does not endorse any kind of approach against tax avoidance, but puts an emphasis on finely delineating responses rather than blunt measures to tackle the problem. However, blunter approaches have been used more often by developing countries due to limited administrative resources. Examining countries’ responses, this research uncovers that the BEPS Project has influenced approaches to transfer pricing, albeit with delays and varied enforcement. The study also reveals discrepancies in addressing treaty shopping, showcasing measures beyond BEPS recommendations that countries adopt when revenue losses are high. The findings further show that the interplay between different governmental departments is pivotal in shaping policy responses to tax avoidance. Show less
Corporate taxation has become an important topic of public debate and corporate tax planning has met with strong societal criticism. In response to these societal concerns, the Organization for... Show moreCorporate taxation has become an important topic of public debate and corporate tax planning has met with strong societal criticism. In response to these societal concerns, the Organization for Economic Co-operation and Development (OECD) launched the OECD/G20 BEPS project. In light of these developments, research on the professional practice of corporate tax planning has become more relevant. In this book, the author investigates tax professionals’ reactions to changing societal expectations of corporate tax planning. Taking a qualitative approach, the responses of different types of tax professionals of the Dutch corporate tax field were examined. Particular attention was paid to the manner in which tax professionals understand corporate tax planning and the public discussion, to what degree societal norms influence the professional practice of corporate taxation, and to what degree tax professionals have altered their role perceptions in response to public concerns of corporate tax planning. Show less
In this article, the authors discuss the implications of their study on the effectiveness of the Multilateral Instrument (MLI). Their analysis finds that there are 79 parties to the MLI and that... Show moreIn this article, the authors discuss the implications of their study on the effectiveness of the Multilateral Instrument (MLI). Their analysis finds that there are 79 parties to the MLI and that the MLI covers 1,231 tax treaties and that the OECD currently overreports the effectiveness of the MLI. Show less
Curaçao is an autonomous country within the Kingdom of the Netherlands and has just one single tax treaty for the prevention of double taxation, namely with Norway. Curaçao has proven unsuccessful... Show moreCuraçao is an autonomous country within the Kingdom of the Netherlands and has just one single tax treaty for the prevention of double taxation, namely with Norway. Curaçao has proven unsuccessful in the conclusion and ratification of full tax treaties. Until now, little attention has been paid to the underlying reasons why Curaçao has proven unsuccessful in building a tax treaty network. The central research question is: “How should Curaçao design its tax treaty policy in order to build a tax treaty network?” This study does not aim to provide recommendations on the technical aspects of a tax treaty policy or a model convention. Rather, the objective of this study is to identify the conditions for building a tax treaty network.The research identifies the obstacles for Curaçao to conclude (and ratify) tax treaties. Furthermore, the research shows which considerations are relevant for Curaçao to build a tax treaty network. The outcome of this research is an evaluation framework that can act as a guide for Curaçao when designing a tax treaty policy or adjusting a potentially existing (but unpublished) tax treaty policy. Show less
Het maken van internationale belastingregels is in het verleden bediscussieerd in het kader van debeginselen voor de verdeling van de heffingsrechten tussen ontwikkelde en ontwikkelingslanden.... Show moreHet maken van internationale belastingregels is in het verleden bediscussieerd in het kader van debeginselen voor de verdeling van de heffingsrechten tussen ontwikkelde en ontwikkelingslanden. Sindsde wereldwijde financiële crisis in 2007-2008 is de discussie veranderd. De focus ligt bij het maken vaninternationale belastingregels thans meer op internationale samenwerking en op het zoeken vanconsensus tussen ontwikkelde landen en ontwikkelingslanden. Echter, er zijn tekortkomingen in dezesamenwerking die gevolgen hebben voor de legitimiteit van de initiatieven, aangezienontwikkelingslanden onvoldoende zijn vertegenwoordigd in de besluitvorming over internationalebelastingregels.Deze bijdrage bespreekt deze tekortkomingen vanuit het perspectief van “verschuivendemachtsverhoudingen in de fiscaliteit” en de rol van ontwikkelde landen, ontwikkelingslanden en ookinternationale organisaties, zoals de OESO, en politieke fora, zoals de G20. De belangrijkste vraag is indezen wat ‘consensus’ betekent voor de legitimiteit, en goed bestuur van landen, internationale organisaties en politieke fora in het maken van internationale belastingregels? Show less
International tax law has not been discussed much by the lawyers involved in public international law. Due to this, there exists a gap, as presently, developments in international law do not... Show moreInternational tax law has not been discussed much by the lawyers involved in public international law. Due to this, there exists a gap, as presently, developments in international law do not correspond to the constant developments in international tax law. This article seeks to highlight the challenges that would arise from the normative expansion of taxation law. Scholars have highlighted the need for a multilateral tax treaty. However, such attempts made by the UN and OECD have failed due to difficulties in ensuring the distribution of taxation power between the source and residence states. This issue becomes more prominent for digital economy taxation, as the digital firms may trade and operate without any physical presence in a state. The present set of proposals suggests introducing new rules for fair allocation of taxing rights and duty on the part of states to tax at a minimum rate. To this end, OECD has introduced the BEPS Inclusive Framework that would include even non-OECD members in decision making. This article underlines the impact of international tax law on different areas of international law and further points out the best practices in trade, investment, and international law so as to bring them in line with the developments in international tax law Show less
Corporate taxation and particularly corporate tax incentives that jurisdictions introduce in special economic zones have not, until recently, been subject to extensive international regulation.... Show moreCorporate taxation and particularly corporate tax incentives that jurisdictions introduce in special economic zones have not, until recently, been subject to extensive international regulation. Only in the last decade has a regime of soft law standards and European Union measures with extraterritorial effect been constructed. This article explains how the Base Erosion and Profit Shifting Action Plan developed by the Organisation for Economic Co-operation and Development (OECD) and the European Union Code of Conduct for Business Taxation interact with corporate tax incentives in special economic zones. Empirical evidence from Latin American and Caribbean jurisdictions shows that this emerging international regime began having an impact on special economic zone laws beyond the OECD and European Union Member States. An analysis of ongoing negotiations on the further developments of the international tax regime permits the cautious conclusion that the regulation of SEZs may in the future be affected in a more fundamental manner by international norms. Thereby, the article shows that special economic zones’ unilateralism in corporate taxation may be slowly receding in contrast to other areas of international economic governance. Show less
The first aim of this chapter is to compare the tax incentives for developing countries with a case study of two countries: Singapore and the Philippines. Following this comparison, the second aim... Show moreThe first aim of this chapter is to compare the tax incentives for developing countries with a case study of two countries: Singapore and the Philippines. Following this comparison, the second aim of this chapter is toevaluate the tax incentives granted in Singapore and the Philippines considering a new proposed evaluative framework for tax incentives in light of the Sustainable Development Goals (SDGs). Show less
This policy note aims at setting a methodological framework for the study of legal transplants in taxation and more specifically to the use of the comparative legal theories of legal transplants,... Show moreThis policy note aims at setting a methodological framework for the study of legal transplants in taxation and more specifically to the use of the comparative legal theories of legal transplants, legal (tax) systems and legal (tax) culture to study the implementation of the Base Erosion and Profit Shifting (BEPS) 4 Minimum Standards. Attention will be given to the following questions who is participating as donor or recipient andwhy? how the tax systems and tax culture (actors) influence the process? and what are the rules that will be implemented?By using comparative legal theories, this policy note allows to explain the reasons why countries decided to implement the BEPS 4 Minimum Standards. These reasons are for instance, prestige, political incentives, and chance and necessity. Furthermore, the study of the differences in tax systems and tax culture can allow policy makers in international organizations and countries to understand the transplantation process and thedevelopment of tax rules implementing the BEPS 4 Minimum Standards. The theory of tax systems will take into account the differences between civil law, common law and mixed legal systems. The theory of tax culture will take into account the behaviour, values and attitudes of the relevant actors (the courts with tax competence, tax law-makers, taxpayers, tax administration, business associations, tax advisors, scholars, and civil society Non-Governmental Organization (NGOs.). In order to illustrate these differences, this policy note has addressed the implementation of the Principal Purpose Test in the countries participating in the BEPS Inclusive Framework. Show less
The main question addressed in this book chapter is: Are the OECD transparency and BEPS Framework the right framework for a global and sustainable tax governance that benefits not only OECD and... Show moreThe main question addressed in this book chapter is: Are the OECD transparency and BEPS Framework the right framework for a global and sustainable tax governance that benefits not only OECD and G20countries but also non-OECD and non-G20 countries, including developing countries? In order to answer this question, this chapter will provide an analysis of sustainable tax governance taking into account the sustainable development goals (SDGs) that the global tax initiatives aim to address and the mechanisms to achieve these goals. Show less
The aim of this article is to assess the regulatory framework of Base Erosion Profit Shifting Project (BEPS) Action 5 in order to evaluate tax incentives in the form of preferential tax regimes... Show moreThe aim of this article is to assess the regulatory framework of Base Erosion Profit Shifting Project (BEPS) Action 5 in order to evaluate tax incentives in the form of preferential tax regimes that provide benefits to geographically mobile business income in developing countries. To conduct this assessment, this article first addresses the use of preferential tax regimes considering BEPS Action 5. Thereafter, and taking into account the concerns expressed by international organizations, regional tax organizations and scholars, the author contends that the evaluation of tax incentives in light of BEPS Action 5 results in additional burden for developing countries. Countries will need to assess their tax incentives considering the factors provided by the 1998 OECD report and BEPS Action 5. Since there are no terms of reference for the application of these factors, the country will have to assess its own tax incentives, which brings increased uncertainty and compliance burden for developing countries. In order to provide some guidance in this evaluation, the author provides a list of the factors used by the 1998 OECD report and BEPS Action 5 and their application to tax incentives. Subsequently, this article will assess the legitimacy of the application of BEPS Action 5 to developing countries and will demonstrate that its assessment framework is ambiguous and prevents developing countries from enacting legitimate tax incentives. Finally, this article will conclude and provide some recommendations for further research. Show less
Thisarticle analyzes the standard of good governance in tax matters introduced bythe ECOFIN Council in 2008, with a view to tackle tax fraud and tax evasion. Atthat time, the standard included... Show moreThisarticle analyzes the standard of good governance in tax matters introduced bythe ECOFIN Council in 2008, with a view to tackle tax fraud and tax evasion. Atthat time, the standard included transparency, exchange of information and fairtax competition. Later on, several OECD and EU developments have changed thecontent of this standard. As of April 2018, the standard of good governanceincludes also the 4 Minimum Standards of the Project to tackle base erosion and profit shifting practicesby multinationals (BEPS). This standard has been introduced by the EU as apre-condition for third (non-EU) countries that receive EU development aid,conclude strategic partnership agreements, free trade and economic partnershipagreements and more recently as a standard that determines whether the third(non-EU) country should be included in a single EU common list ofnon-cooperative jurisdictions. This article aims answers two questions (i)whether the standard of good governance intax matters is an import and/or export of EU norms? and (ii) what is thelegal status of this standard vis-á-vis third (non-EU) countries? Finally,this article provides conclusions and recommendations for further research. Show less
The approach of the Netherlands to tackling tax evasion and tax avoidance has changed over the course of the years 2015 to 2018. These changes are to a great extent the result of the priority of... Show moreThe approach of the Netherlands to tackling tax evasion and tax avoidance has changed over the course of the years 2015 to 2018. These changes are to a great extent the result of the priority of the Dutch government to ensure that “the Netherlands’ image as a country that makes it easy for multinationals to avoid taxation”is overturned by appropriate measures. As a member of the OECD, the Netherlands has participated in the design of the content of the BEPS Actions and in the BEPS Inclusive Framework. In general, the Netherlands has adopted all BEPS Actions and it has committed to the BEPS Multilateral Instrument for almost all its tax treaty network and with very few reservations. More recently, in February 2018, the State Secretary of Finance published two Policy Letters, one to introduce the Tax Policy Agenda and the other to introduce measures to tackle tax avoidance and tax evasion. The Dutch government has proposed in the Tax Policy Agenda several measures to counteract tax avoidance including the adoption of the EU Anti-Avoidance Tax Directives (ATAD 1 and ATAD 2) with some stricter requirements. If the measure relating to ATAD 1 is approved by the Dutch Parliament, the result will be a stricter rule than the minimum standard of ATAD 1. In order to address the needs of investors, the Netherlands is also proposing favourable rules such as the elimination of the Dutch dividend withholding tax and reduction of the corporate income tax rate. As of July 2018, these measures are still under discussion. Show less
The world is facing a new round of international tax competition that may result in a ruinous race to the bottom, undermining the fiscal capacity of states to respond to global challenges and to... Show moreThe world is facing a new round of international tax competition that may result in a ruinous race to the bottom, undermining the fiscal capacity of states to respond to global challenges and to implement the Agenda 2030. G20 leaders must take action to strengthen multilateral and cooperative approaches to taxation, curtail harmful tax competition and protect their own tax base as well as that of developing countries. Show less
In this article, the author considers output legitimacy deficits in the context of the Inclusive Framework of the OECD/G20 Base Erosion and Profit Shifting Initiative, with special emphasis on the... Show moreIn this article, the author considers output legitimacy deficits in the context of the Inclusive Framework of the OECD/G20 Base Erosion and Profit Shifting Initiative, with special emphasis on the issues and problems that this raises for developing countries. Show less
In this book, the author addresses the legal and political aspects of a multilateral tax treaty that fundamentally transforms the way states cooperate in the field of international taxation.... Show moreIn this book, the author addresses the legal and political aspects of a multilateral tax treaty that fundamentally transforms the way states cooperate in the field of international taxation. Working from a normative and pragmatic view on international tax relations, he proposes a management-focused approach to multilateral cooperation in international taxation. The resulting managerial framework treaty is drawn up on the basis of insights from political science and legal philosophy and is illustrated by means of international public law. Finally, the author evaluates the recently-adopted text of the Multilateral Convention to Implement Tax Treaty Related Measures to Prevent BEPS (the BEPS Convention) in the light of his proposed framework. Show less
The aim of this article is to examine the differences in perception of ‘fairness’ between developing and developed countries, which influence developing countries’ willingness to embrace the Base... Show moreThe aim of this article is to examine the differences in perception of ‘fairness’ between developing and developed countries, which influence developing countries’ willingness to embrace the Base Erosion and Profit Shifting (BEPS) proposals and to recommend as to how to overcome these differences. The article provides an introduction to the background of the OECD’s BEPS initiatives (Action Plan, Low Income Countries Report, Multilateral Framework, Inclusive Framework) and the concerns of developing countries about their ability to implement BEPS (Section 1); a non-exhaustive overview of the shortcomings of the BEPS Project and its Action Plan in respect of developing countries (Section 2); arguments on why developing countries might perceive fairness in relation to corporate income taxes differently from developed countries (Section 3); and recommendations for international organisations, governments and academic researchers on where fairness in respect of developing countries should be more properly addressed (Section 4). Show less
In deze bijdrage bespreken de auteurs het Multilaterale Instrument, dat is ontwikkeld in het kader van het BEPS-project. De auteurs gaan in op de werking van het Multilaterale Instrument en de... Show moreIn deze bijdrage bespreken de auteurs het Multilaterale Instrument, dat is ontwikkeld in het kader van het BEPS-project. De auteurs gaan in op de werking van het Multilaterale Instrument en de verhouding daarvan met het internationaal publiekrecht. Ook behandelen de auteurs enkele aspecten van de interpretatie van het Multilateraal Instrument en de standpuntbepaling van Nederland, zoals die tot uiting is gekomen in de brief van de staatssecretaris van 28 oktober 2016 en in de reactie op de Tweede Kamervragen die naar aanleiding van die brief zijn gesteld. Show less
