scholarly journals The international Challenges and Finnish Corporate Taxation

2014 ◽  
Vol 2014 (2) ◽  
pp. 132-148
Author(s):  
Juha Lindgren
Keyword(s):  
Corporate Taxation ◽  
Corporate Tax ◽  
Tax Base ◽  
Tax Rate ◽  
Cross Border ◽  
Exchange Of Information ◽  
The Cross ◽  
National Tax

Abstract One of the main trends in Finnish corporate taxation during the last ten years has been the lowering of the corporate tax rate. The decision to lower the corporate tax rate to 20% from the beginning of 2014 also changed the approach in reforming the corporate taxation as it was decided to stay on the grounds of a broad tax base and not to make loopholes in it with targeted exceptions. The Finnish corporate taxation contains also some provisions that act as incentives for investment and the establishment of companies. However, the focus has been lately on the rules with purpose to protect the national tax base. Therefore, article handles both the specific anti avoidance rules and the application of the general anti avoidance rule on the cross-border transactions. Some particular challenges and the exchange of information are also taken into account before the conclusion with some ideas and aspects on future reforms.

scholarly journals An Estimable Model of Income Redistribution in a Federation: Musgrave Meets Oates

2019 ◽  
Vol 11 (1) ◽  
pp. 406-434 ◽  
Author(s):  
Kevin Milligan ◽  
Michael Smart
Keyword(s):  
Tax Avoidance ◽  
Tax Base ◽  
Tax Rate ◽  
Personal Taxes ◽  
Cross Border ◽  
State Tax ◽  
Decentralization Reform ◽  
National Tax ◽  
Optimal Taxes ◽  
Personal Taxation

We develop a theory of cross-border income shifting in response to subnational personal taxation in a federation and examine its implications for the excess burden of personal taxes. We show how a properly chosen federal tax rate can offset the fiscal externality between states and facilitate decentralization, even in a heterogeneous federation where unitary taxation is suboptimal. Optimal taxes depend on the elasticities of national tax avoidance and of cross-state tax base shifting. We estimate these elasticities around a tax decentralization reform in Canada, finding both to be empirically relevant. We discuss the implications for optimal federalism. (JEL D31, H21, H23, H24, H26, H71, H77)

scholarly journals The Analysis of the Cross-border Corporate Profit’s Taxation

2019 ◽  
Vol 11 (2) ◽  
Author(s):  
Rita Koroseczné Pavlin ◽  
Diána Koponicsné Györke
Keyword(s):  
Special Focus ◽  
Corporate Tax ◽  
Tax Base ◽  
Member States ◽  
Tax Rate ◽  
Direct Taxation ◽  
Cross Border ◽  
The Common ◽  
The Given ◽  
A Company

Ensuring the same competition conditions for the companies in EU requires tax harmonization between Member States. In this paper, we review some elements of the harmonization efforts. We will discuss the OECD guidelines on direct taxation and the transfer price regulation as a way to regulate corporate tax optimization behaviour. Based on the Effective Average Tax Rate we introduce the differences in the taxation of profits between Member States. The Common Consolidated Corporate Tax Base is one of the key elements in the harmonization of cross-border corporate profit taxation, so our study has a special focus on the proposal. The undisputed advantage of the CCCTB would be the simplification of the taxation of transactions between Member States. However, it also raises the question of how it limits the ability of each Member State to attract capital and to what extent can assign the profit tax to the given country in proportion to the operation of a company and with this how to realize that the base of the corporate tax focuses on the place of activity.      

scholarly journals Corporate taxation in Iceland and the international challenge

2014 ◽  
Vol 2014 (2) ◽  
pp. 149-172
Author(s):  
Fjóla Agnarsdóttir ◽  
Rakel Jensdóttir
Keyword(s):  
Tax Avoidance ◽  
Legal Framework ◽  
Corporate Taxation ◽  
Point Of View ◽  
General Description ◽  
Corporate Tax ◽  
Tax Base ◽  
Economic Point ◽  
Tax Rate ◽  
The Past

Abstract This article aims to describe the development in the field of corporate tax law in Iceland, from both legal and economic point of view, with a focus on measures taken to protect the tax base and in order to try to make Iceland an attractive place for investment and establishment companies. First, there will be a brief general description of the development of the corporate tax rate in Iceland since 2004 and an overview of new taxes that have been introduced for companies over the past ten years. Second, there will be an analysis of how the Icelandic legal framework provides for incentives for investment and establishment of companies in Iceland. Third, this discussion is to be followed by a section on the steps Iceland has taken in order to combat tax avoidance. Fourth, there is a general description of the economic development for the corporate taxation in Iceland since 1990 and fifth, there is brief discussion of the development of revenues from the corporate tax. Sixth, a short overview of the real investment in the Icelandic economy is given, and finally, the main conclusions of this article will be summed up with a short discussion on the main challenges Iceland is currently facing in the field of corporate taxation in today’s globalised economy.

scholarly journals Abuses and Penalties of a Corporate Tax Inversion

2019 ◽  
Vol 7 (1) ◽  
pp. 5
Author(s):  
James Yang ◽  
Leonard Lauricella ◽  
Frank Aquilino
Keyword(s):  
Multinational Corporations ◽  
International Taxation ◽  
Internal Revenue Service ◽  
Tax Law ◽  
Corporate Tax ◽  
Tax Base ◽  
Tax Rate ◽  
Tax Savings ◽  
Treasury Department ◽  
The U.S

There is a serious problem in international taxation today. Many United States (U.S.) multinational corporations have moved abroad to take advantage of a lower tax rate in a foreign country. As a consequence, the tax base in the U.S. has been seriously eroded. This practice is known as “corporate tax inversion”. This paper discusses the abuses and penalties of this phenomenon. It is rooted in some deficiencies in the U.S. tax law. This paper points out that the U.S. has the highest corporate tax rate in the world. It imposes tax on worldwide income. It permits deferral of tax on foreign-sourced income until dividends are repatriated back to the U.S. As a result, it creates tax loopholes. This paper reveals six actual cases of corporate tax inversion. This practice has triggered the Congress to enact §7874, the Internal Revenue Service (IRS) to issue Notices IR 2014-52 and IR 2015-79, and the U.S. Treasury Department to promulgate TD 9761. This paper investigates some details of these penalties. This paper further demonstrates an example in determining the amount of tax savings by engaging in a corporate tax inversion. It also offers many strategies.

scholarly journals IMPACT OF A COMMON CORPORATE TAX BASE ON THE EFFECTIVE TAX BURDEN IN BELGIUM

2014 ◽  
Vol 15 (3) ◽  
pp. 530-543 ◽  
Author(s):  
Annelies Roggeman ◽  
Isabelle Verleyen ◽  
Philippe Van Cauwenberge ◽  
Carine Coppens
Keyword(s):  
European Commission ◽  
Size Effects ◽  
Tax Burden ◽  
Corporate Tax ◽  
Tax Base ◽  
Tax Harmonization ◽  
Tax Deductions ◽  
National Tax ◽  
The Impact ◽  
Insight Into

In March 2011, the European Commission launched a proposal for a Common Consolidated Corporate Tax Base (CCCTB). However, a Common Corporate Tax Base (CCTB), leaving consolidation and apportionment out of consideration, appears to be a more realistic proposition for corporate tax harmonization in Europe. Using the European Tax Analyzer (ETA), we simulate the impact of the CCTB on the effective tax burden in Belgium. The results show that the adoption of the CCTB increases the Belgian effective tax burden by 16%. This remarkable increase is mainly driven by the fact that national tax deductions are not allowed under CCTB. This study allows policymakers to gain insight into the size effects of certain corporate tax measures and contributes to the current discussion on corporate tax harmonization in Europe.

scholarly journals CFC rules in the context of the proposed CCCTB directive

2011 ◽  
Vol 59 (7) ◽  
pp. 363-370
Author(s):  
Veronika Sobotková
Keyword(s):  
Tax Avoidance ◽  
The European Union ◽  
Corporate Tax ◽  
Tax Base ◽  
Tax Preference ◽  
Cross Border ◽  
Council Directive ◽  
Pros And Cons ◽  
Low Costs ◽  
Cfc Rules

In the proposal for a Council Directive on a Common Consolidated Corporate Tax Base (CCCTB) there have been introduced a specific anti-abuse provisions, CFC rules. These rules are aimed at tax evasions and tax avoidance. The basic principle is the protection of the tax base against erosion through practices of artificial income shifting. Generally, CFC rules prevent tax avoidance in a state of a shareholder by denying the deferred taxation of profits generated by its controlled company, which is a resident in a tax preference jurisdiction. Even thought the CCCTB directive would be aided easier and low-costs cross-border business as well as it would be restricted the harmful tax competition there are questions whether it is advisable to introduce these rules into such system of the CCCTB, whether these rules are compatible with the CCCTB and whether it is regulated properly. So, the focus of this paper rests on the interaction of the proposed CCCTB directive with existing CFC rules in the European Union. The paper deals with pros and cons, economic and legal perspectives these rules in the context of the proposed CCCTB directive.

scholarly journals Comparison of Income Tax Base in Visegrad Countries

2021 ◽  
Vol 16 (2) ◽  
pp. 101-110
Author(s):  
Jana Hinke ◽  
Tomáš Rain ◽  
Barbora Hrabovská
Keyword(s):  
Literature Review ◽  
Income Tax ◽  
Corporate Tax ◽  
Tax Base ◽  
Tax Rate ◽  
The Disabled ◽  
The Impact ◽  
Visegrád Countries ◽  
Calculation Procedures

Abstract The objective of the research was to compare the procedures for the calculation of income tax in the Visegrad Four (V4) countries. The statutory income tax calculation procedures are very similar in the V4 countries. Particular systems differ parametrically. Based on a literature review, synthesis of knowledge, comparison and simulation calculations, it can be stated that Hungary has the lowest corporate tax rate, and in the simulative calculations it also produced the lowest tax and highest profit after taxation for a fictitious entity in Hungary. Income tax in the V4 countries differs mainly in the possibility of applying the loss of previous years, in the impact of depreciation on the amount of the tax and in the income tax rebate linked to the employment of the disabled.

Corporation Tax, the Exchange Rate, and Cross-Border Firm Mobility

2021 ◽  
Author(s):  
Wataru Johdo
Keyword(s):  
Exchange Rate ◽  
Open Economy ◽  
Corporate Tax ◽  
Economy Model ◽  
Tax Rate ◽  
Corporation Tax ◽  
New Open Economy Macroeconomics ◽  
Cross Border ◽  
Tax Reduction ◽  
Foreign Countries

In this paper, we extend a new open economy macroeconomics (NOEM) model to examine the effects of a corporate tax reduction on home and foreign countries. The feature of this open economy model is that cross-border relocation of firms is allowed. We show that (i) a reduction in the home corporate tax rate induces an exchange rate appreciation (depreciation) when the degree of cross-border firm mobility is large (small) and (ii) when the degree of cross-border firm mobility is large (small), a reduction in corporate tax is beneficial (detrimental) to the domestic country but detrimental (beneficial) to the foreign country.

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