Purpose of the blog This blog raises the question as to whether the Pillar I Amount A proposal is consistent with the value creation standard? Naturally, as a start, the question arises as to what the value creation standard is. Value creation standard Although the meaning of value creation, as used in the BEPS project,…

1. Introduction The Pillar Two Report[1] (the “Report”) which contains the Global Minimal Tax (the “GloBE tax”) proposal has recently been on the top of discussions both in the academic and practice world. While the proposals objective is debatable[2], the blueprint contains dozens of new rules, exceptions and mechanisms which may possibly complicate life not…

1. Introduction The ability to stimulate economic activity and to attract foreign capital and investments through national tax policies has been known for many centuries. It was in the middle of the eighteenth century that the Russian Empress – Catherine the Great – granted to “[…] Foreigners that have settled themselves in Russia to erect…

We are glad to announce that Dr Giorgio Beretta has joined the Kluwer International Tax Blog’s team as an editor, responsible for the new section of the blog dedicated to VAT/GST and indirect taxation. Dr Beretta holds a PhD in Tax Law from LIUC University (Milan, Italy), where he defended his doctoral thesis on “European…

Purpose of the blog The purpose of the blog, which is slightly futuristic, is to discuss whether countries will still compete with one another to attract activities in their jurisdiction post-Pillar II implementation. State sovereignty and Tax Competition A sine qua non condition for the existence of international tax competition is the opportunity to transfer capital…

The purpose of this short contribution is to shed some light on the discussion regarding an Uber drivers’ qualification – whether they should be considered employees or independent contractors. If Uber is considered as an employer and the driver as an employee, then the Company will be responsible for certain matters. For instance, depending on…

1. Purpose of the blog This contribution is a follow up to the previous contribution of the author. The objective is to address the tentative impact of the Pillar I debate on decentralized MNE business models in light of the “ongoing work” of the OECD with respect to the digitalization of the economy[1]. The reader…

1. Purpose of the contribution The purpose of this contribution is to address the impact of the Pillar I debate on principal structures or centralized business models. The tentative assessment will be made in light of the “ongoing work” of the OECD with respect to the digitalization of the economy[1]. 2. Illustration of a typical…

Purpose of the blog The purpose of this blog is to address whether the transactional profit split method (TPSM) applies to centralized business models operated by multinational enterprises (MNEs). The assessment will be made in light of the post BEPS transfer pricing guidance, that is, the 2017 OECD Transfer Pricing Guidelines (TPG) and the revised…

Corresponding adjustments and the MAP process When the price charged for goods or services sold between related parties is not in accordance with the arm’s length principle, Article 9(1) of the OECD Model authorizes the tax authorities of a State to make primary adjustments to the transfer price. This may trigger economic double taxation as…

1. Purpose of the blog Intra-group guarantees are usually used by companies within the same multinational enterprise to obtain beneficial conditions for funding arrangements. For instance, lower interest rates due to the decreased level of the credit risk assumed by the lender (such as a bank) or/and extended borrowing capacity. In this blog, we will…

Introduction Recently captive insurance arrangements have been scrutinized all over the world by tax authorities as they are believed to be vehicles that encourage profit shifting. The OECD, in the BEPS Action Plan, had considered captive insurance arrangements as a major area of concern. In fact, in the recently released 2018 OECD discussion draft on…

Introduction One of the advantages multinational groups enjoy over standalone companies is that their members have access to each other’s resources (such as, e.g., funding). In particular, less capable entities can boost their credibility if a related entity provides them with a performance guarantee, i.e., pledges to fulfill their contractual obligations in case they fail…

Introduction One of the most controversial topics of transfer pricing, in today’s multinational world, is the pricing of intercompany financial transactions. The 2017 OECD transfer pricing guidelines (TPG) lack clear rules specifically tailored to financial transactions, which can lead to a higher risk of divergent treatment of these transaction between tax administrations and taxpayers and…