Issues In International Taxation Model Tax Convention Four Related Studies

This publication, includes four recent reports of the Committee on Fiscal Affairs that have resulted in changes to the Commentary of the Model Tax Convention on Income and on Capital.

Compilation of four related studies.

The first report outlines the reasons why international tax avoidance and evasion through the use of tax havens is a concern to the tax authorities of OECD Member countries and examines measures introduced to combat such use. The second report sets out the problems posed for tax administrations by the fact that their resident taxpayers make use of base companies (generally subsidiary companies) in tax havens to shelter there income derived from source countries (which may in some cases be the residence country itself) and in that way to escape tax normally payable to the country of residence. The third report deals with the problems created for tax authorities in source countries by the mechanism of "treaty shopping". The final report deals with taxation and the abuse of bank secrecy.

Four reports of the OECD that have resulted in changes to the Commentary of the Model Tax Convention on Income and on Capital. The studies deal with the computation of the 183-day rule of sub-paragraph 2b) of Article 15 of the Model, the application of tax conventions to "triangular cases", the tax treatment of software payments and the tax treatment of employees' contributions to foreign pension schemes.

This report addresses the issue of the application of tax treaties to cases involving partnerships in detail and focuses on specific factual examples.

This book recommends that Article 14 be eliminated from the OECD Model Tax Convention and describes the changes that would need to be made to the Articles and Commentary of the Model as a consequence.

This publication includes three recent reports that resulted in changes to the OECD Model Tax Convention. One covers entitlement to treaty benefits, another covers e-commerce, and the third covers issues arising under the permanent establishment article.