International Tax

Low-income countries are more dependent on corporate income tax revenue than richer countries, and at the same time, disproportionately affected by multinational tax avoidance. Our research on this theme investigates ways in which developing countries can protect their tax bases, including through simplified transfer pricing methods and improved tax treaty policies. Our work on this theme also includes examination of the OECD’s Base Erosion and Profit Shifting (BEPS) process from the perspective of developing countries, as well as exploring alternative methods of taxing multinational companies, namely unitary taxation.

Publications:

November 2018
Problems of Transfer Pricing and Possibilities for its Simplification
by Sol Picciotto

This ICTD Research in Brief is a two-page summary of ICTD Working paper 86 by Sol Picciotto. This series is aimed at policy makers, tax administrators, fellow researchers and anyone else who is big on interest and short on time. The international system for taxation of the profits of multinational enterprises (MNEs) is deeply dysfunctional….

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November 2018
Problems of Transfer Pricing and Possibilities for Simplification
by Sol Picciotto

The defects in the rules for allocation of the income of transnational corporations (TNCs) are at the heart of the current crisis in international corporate taxation. This paper explains how these rules emerged and developed, becoming increasingly complex, as they have shifted from a general concern to ensure a fair and reasonable allocation of the…

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August 2018
Chapter 5: A Corporate Tax Policy Agenda for Lower-Income Countries
by Michael C. Durst

In the preceding four chapters of this book, I have sought to explore (i) the economic and political roots of base erosion and profit shifting in lower-income countries and (ii) the recent (and continuing) efforts of the OECD and other international organizations to redress the problem, in connection with the BEPS studies. Based on the…

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July 2018
Chapter 4: The OECD’s BEPS Project and Lower-Income Countries
by Michael C. Durst

In reviewing the OECD’s BEPS process as it relates to lower-income countries, it may be useful to begin with a question about global tax institutions: Why, as controversy arose over base erosion and profit shifting after the 2008 Financial Crisis, did the OECD assume leadership of the ensuing intergovernmental study of the topic, instead of…

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June 2018
Chapter 3: The Historical Evolution of Base Erosion and Profit Shifting
by Michael C. Durst

This is Chapter 3 of the book “Taxing Multinational Business in Lower-Income Countries: A Problem of Economics, Politics and Ethical Norms”. This chapter examines the evolution, over almost a century, of the body of international tax laws that continues to insulate BEPS-style planning arrangements from successful legal challenge in countries around the world.

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Taxing Africa: Coercion, Reform and Development
by Mick Moore, Wilson Prichard & Odd-Helge Fjeldstad

Taxing Africa is an accessible and comprehensive introduction to the crucial debates around taxation and development in Africa. Taxation has been seen as the domain of charisma-free accountants, lawyers and number crunchers – an unlikely place to encounter big societal questions about democracy, equity or good governance. Yet it is exactly these issues that pervade…

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May 2018
Linking Beneficial Ownership Transparency to Improved Tax Revenue Collection in Developing Countries
by Wilson Prichard

Recent years have witnessed an accelerating push to expand access to information on the beneficial ownership of corporate entities, in an effort to bring greater transparency to multinational corporation (MNC) tax strategies, identify personal tax-evading wealth held overseas and combat global networks of criminality and corruption. This effort remains in its infancy, but has made…

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March 2018
Chapter 2: Poverty, Tax Competition, and Base Erosion
by Michael C. Durst

This is Chapter 2 of the book “Taxing Multinational Business in Lower-Income Countries: A Problem of Economics, Politics and Ethical Norms”. In this installment, which is Chapter 2, the author examines the basic economic dilemma faced by lower-income countries with respect to the corporate tax and offers an historical overview of BEPS-style corporate tax planning.

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February 2018
Chapter 1: Taxing Multinational Business in Low-Income Countries
by Michael C. Durst

The book explores a topic that has been highly controversial in recent years: the use by multinational companies of “base erosion and profit shifting” tax planning structures to reduce their tax liabilities in countries where they conduct business, including the world’s lower-income developing countries. In this instalment, which is Chapter 1, the author provides an…

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November 2017
Assisting Developing Countries in Taxation after the OECD’s BEPS Reports: A Suggested Approach for the Donor Community
by Michael C. Durst

This paper explores how the international donor community might most productively offer technical assistance to developing countries in the area of taxation, in light of the OECD’s recently completed study of ‘base erosion and profit shifting’ (BEPS). The paper addresses both the political and the technical constraints facing developing country tax administrations. It recommends that…

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Blogs:

August 2018
by Kas Sempere

What does tax justice mean at the local level, and how can the experiences of informal market traders be linked with broader international campaigns? This blog draws out insights from ActionAid’s experience of incorporating the demands of market traders in Nigeria into its international tax justice campaign.

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May 2018
by Maya Forstater

Professor Sol Picciotto recently wrote an article which responds to a paper I wrote on the question of what is meant by “illicit financial flows” (IFFs) and in particular whether tax avoidance and tax planning by multinational enterprises should be included in the concept. As a reader of the ICTD website it is likely that…

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May 2018
by Sol Picciotto

In a recent paper, revised and published as a blog post, I argued that tax avoidance by multinationals should be included in the official definitions of illicit financial flows (IFFs). I argue that a broad definition of IFFs is essential, since they all use the offshore tax haven and secrecy system, which indeed multinationals helped…

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