Thursday, May 30, 2013
The three-day annual meeting of the European Association of Tax Law Professors kicks off today in Lisbon, Portugal. Henry M. Ordower (St. Louis) presents Tax Neutrality Between CIT and Non-CIT Subjects: How to Improve our Systems?:
This brief thematic report argues that a wholly transparent income tax system would improve existing CIT systems and establish tax neutrality between CIT and non-CIT subjects. Full transparency is consistent with international treaty obligations and simultaneously eliminates many international tax arbitrage opportunities. Business needs rather than tax benefits would drive choice of business form. If accompanied by a robust system of international apportionment of business income, a fully transparent corporate income tax would eliminate most income allocation arbitrage as well as tax system structure arbitrage opportunities.