Foundations of international corporate taxation

This book for students and practitioners focuses on the foundations of international corporate taxation. The OECD Model Convention with Respect to Taxes on Income and on Capital is one of the most successful endeavors towards harmonization of legal norms. Over five decades, it has laid the groundwork for more than 3,000 tax treaties around the world. Yet the rise of automation, the multiplication of business relocations, and the digitalization of the economy have gradually undermined the bedrock of this lingua franca. While the century-old concept of economic allegiance remains relevant for the assignment of taxing rights to states, the digital age allows for considerable profits to be generated with a relatively small workforce. Aggressive planning, treaty shopping and transfer pricing practices further contribute to erode tax bases. Relying on three pillars - coherence, substance, and transparency -, the OECD Base Erosion and Profit Shifting Project aims to adapt the international tax order to the 21st century. The global minimum corporate tax rate is another attempt to address these concerns. In twelve chapters, the author explains the mechanisms designed to eliminate double taxation and to prevent non-taxation. The book places emphasis on the concept of income as it governs the choice of the assignment rules.