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Monday, Could 1, 2023
Avi-Yonah Posts Three Tax Papers On SSRN
Reuven S. Avi-Yonah (Michigan; Google Scholar) has posted three tax papers on SSRN:
Comply with the Cash: Why Is Worldwide Tax Bilateral?:
Worldwide tax legislation has historically been constructed upon bilateral treaties and unilateral actions, whereas commerce legislation has historically been multilateral and worldwide funding legislation has been bilateral however with Most Favored Nation (MFN) clauses that render it successfully multilateral. This paper explores the explanations and asks whether or not they’re nonetheless legitimate.
Why 15%? Justifying the World Company Minimal Tax:
The worldwide company minimal tax (GLoBE) as embodied in Pillar 2 of the OECD/IF BEPS 2.0 proposal was set in October 2021 at 15% of the monetary assertion earnings of inside scope MNEs. That can be the speed and the bottom of the brand new US company different minimal tax (CAMT). The Single Tax Precept (STP) on which Pillar 2 is constructed means that the speed must be the typical OECD company tax fee (about 23%). So, is the 15% fee solely a concession to political actuality? No, as a result of it represents a justifiable compromise between the three objectives of the company tax.
What Does the US Get from Pillar 2?:
In latest months, there was a pointy enhance in criticism leveled within the US towards Pillar 2 of the G20/OECD BEPS 2.0 effort. Particularly, it has been argued that Pillar 2 (and particularly the UTPR) is inconsistent with US tax treaties, that Pillar 2 just isn’t wanted to handle revenue shifting, and that the US is unlikely to derive income from Pillar 2. None of those arguments are persuasive. Pillar 2 is according to the treaties, it addresses revenue shifting, and whereas the US could or could not derive income from it, that isn’t the purpose of Pillar 2 or of the company tax. Lastly, whereas the UTPR could restrict some US tax expenditures, that isn’t clearly the case, and if it does then the identical objectives could also be achieved by different means.
https://taxprof.typepad.com/taxprof_blog/2023/05/avi-yonah-posts-three-tax-papers-on-ssrn.html
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