INTERNATIONAL TAXATION
WELL WRITTEN SUMMARY
Direct taxes
Taxes paid directly to the government tax authorities by
the taxpayer, including personal income taxes, corporate
income taxes, and wealth taxes.
Indirect taxes
- Consumption taxes
- Withholding taxes
- Value-added tax
- Border tax
- Transfer tax
Purpose of Taxes
- Source of income
- Supporting the politics of a country
- Competition
VAT Switzerland
2009: 7.7% support the disability insurance
2011-2017 Tax rate 8%
Since 2018 Tax rate 7.7%
2022: 8.1%
Indirect Taxes Definition
Taxes levied on spending to buy goods and services,
called indirect because payments of some or all of the
taxes by the consumer is paid to the government
authorities by the firms.
What is international Tax Law?
- No universal "international tax."
,- Governs taxation of cross-border activities.
International Tax Agreements: Treaties between
countries.
Domestic Laws: Each country's internal tax regulations.
International Tax Agreements: Double Taxation
Agreements (DTAs)
Common treaties to avoid double taxation, also called Tax
Treaties or Tax Conventions.
International Tax Agreements: Agreements
- Cover specific income types (e.g., shipping, air
transport).
- Focus on specific taxes (e.g., social security).
- Enable information exchange and tax collection
assistance.
What is Double Taxation
Double Taxation: Income taxed in more than one
country.
DTAs: Prevent double taxation and fiscal evasion by
allocating taxing rights. Rights can be exclusive or shared
between countries.
Types:Bilateral: Between two countries.Multilateral:
Regional (e.g., Nordic DTA, CARICOM DTA).
OECD Model Tax Convention on Income and on
Capital
Purpose: Provides a uniform framework to address
international double taxation issues.
Guidance: OECD Council recommends member
countries align DTAs with the Model Convention and
commentary, considering country-specific reservations.
UN Model Double Taxation Convention Between
Developed and Developing Countries
, - Designed for developing countries.
- Ensures fair taxing rights and combats tax evasion.
- Updated by UN Tax Cooperation Experts.
- Includes a tax treaty negotiation manual.
Tax Technology Trends
- Robotic
- Artificial intelligence
- Blockchain
- Pattern Matching
- Big Data
- Deep Learning
UK plastic packaging tax ("PPT")
Aim: Incentivize recycled material use in plastic
packaging.
Tax Rate: £200/tonne for packaging with <30% recycled
plastic (threshold: 10 tonnes).
Compliance: Registration required even if no tax is
payable.
Information Exchange Model
- Promotes tax cooperation via information exchange.
- Developed in 2002 by the OECD Global Forum.
- Basis for many bilateral agreements (non-binding).
- Overseen by Global Forum with 100+ jurisdictions.
- Standards in TIEA and OECD/UN Tax Conventions
enable exchange of relevant tax info.
BEPS
- Multinational companies exploit tax gaps, especially
harming developing countries.
- Costs $100-240 billion annually (4-10% of global
corporate tax).
WELL WRITTEN SUMMARY
Direct taxes
Taxes paid directly to the government tax authorities by
the taxpayer, including personal income taxes, corporate
income taxes, and wealth taxes.
Indirect taxes
- Consumption taxes
- Withholding taxes
- Value-added tax
- Border tax
- Transfer tax
Purpose of Taxes
- Source of income
- Supporting the politics of a country
- Competition
VAT Switzerland
2009: 7.7% support the disability insurance
2011-2017 Tax rate 8%
Since 2018 Tax rate 7.7%
2022: 8.1%
Indirect Taxes Definition
Taxes levied on spending to buy goods and services,
called indirect because payments of some or all of the
taxes by the consumer is paid to the government
authorities by the firms.
What is international Tax Law?
- No universal "international tax."
,- Governs taxation of cross-border activities.
International Tax Agreements: Treaties between
countries.
Domestic Laws: Each country's internal tax regulations.
International Tax Agreements: Double Taxation
Agreements (DTAs)
Common treaties to avoid double taxation, also called Tax
Treaties or Tax Conventions.
International Tax Agreements: Agreements
- Cover specific income types (e.g., shipping, air
transport).
- Focus on specific taxes (e.g., social security).
- Enable information exchange and tax collection
assistance.
What is Double Taxation
Double Taxation: Income taxed in more than one
country.
DTAs: Prevent double taxation and fiscal evasion by
allocating taxing rights. Rights can be exclusive or shared
between countries.
Types:Bilateral: Between two countries.Multilateral:
Regional (e.g., Nordic DTA, CARICOM DTA).
OECD Model Tax Convention on Income and on
Capital
Purpose: Provides a uniform framework to address
international double taxation issues.
Guidance: OECD Council recommends member
countries align DTAs with the Model Convention and
commentary, considering country-specific reservations.
UN Model Double Taxation Convention Between
Developed and Developing Countries
, - Designed for developing countries.
- Ensures fair taxing rights and combats tax evasion.
- Updated by UN Tax Cooperation Experts.
- Includes a tax treaty negotiation manual.
Tax Technology Trends
- Robotic
- Artificial intelligence
- Blockchain
- Pattern Matching
- Big Data
- Deep Learning
UK plastic packaging tax ("PPT")
Aim: Incentivize recycled material use in plastic
packaging.
Tax Rate: £200/tonne for packaging with <30% recycled
plastic (threshold: 10 tonnes).
Compliance: Registration required even if no tax is
payable.
Information Exchange Model
- Promotes tax cooperation via information exchange.
- Developed in 2002 by the OECD Global Forum.
- Basis for many bilateral agreements (non-binding).
- Overseen by Global Forum with 100+ jurisdictions.
- Standards in TIEA and OECD/UN Tax Conventions
enable exchange of relevant tax info.
BEPS
- Multinational companies exploit tax gaps, especially
harming developing countries.
- Costs $100-240 billion annually (4-10% of global
corporate tax).
