Summary: Business Taxation

Read the summary and the most important questions on Business Taxation

• 1 Lecture 5 Country by Country Reporting

• 1.2.2 Public opinion and MNEs' fair share

• What is the reason crisis is often less bad then expected?

  Because of state aid. The country often helps the companies and banks to make sure they don't crash completely.

• What happened to the people during the financial and covid crisis.

  People lost a lot of money and went unemployed

• What was the government its response to the crisis?

  State aid en financial stimulus

• Why where the leaks of confidential financial information in tax havens helpful?

  So that tax authorities could use the data to fight tax evasion.

• What is a tax haven according to the EU Blacklist?

  It reefers to jurisdiction that are non-cooperative for tax purposes. Being on the list leads to reputational damage and sanctions from EU Member States.

• 1.2.3 The global tax transparency agenda

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• What are international initiatives to combat tax avoidance?

  • G20 London summit
    
  • Base Erosion and Profit Shifting (BEPS) project
  • Automatic exchange of information (AEOI)
  • Two-pillar solution

• What are National & EU initiatives to combat tax avoidance?

  • Anti-Tax Avoidance Directive (ATAD)
    
  • Diverted Profits Tax (DPT)
  • Tax Cuts and Jobs Act (TCJA)
  • EU Directives on Administrative Cooperation (DAC)

• 1.3.1 Intra-group tax planning for MNEs

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• What is tax avoidance?

  Tax avoidance is lawful but not in line with the spirit of the law. Obey's the law but not the intent of the law.

• What are transfer pricing manipulations?

  Profit shifting strategies aiming to reduce the overall tax burden by taking advantage of differences in tax rates between countries. Shifting profits form high-tax jurisdictions to low-tax jurisdictions.

• What is debt financing for tax avoidance?

  Company in low-tax jurisdiction loaning to a company in a high tax jurisdiction with a high interest. The company in the low tax jurisdiction will have high profit low taxed and the company in the high tax jurisdiction will have a big interest expense for deduction.