Description
Book SynopsisThis is an open access title available under the terms of a CC BY-NC-ND 4.0 licence. It is offered as a free PDF download from OUP and selected open access locations. This book undertakes a fundamental review of the existing international system of taxing business profit. It steps back from the current political debates on how to combat profit shifting and how taxing rights over the profits of the digitalized economy should be allocated. Instead, it starts from first principles to ask how we should evaluate a tax on business profitand whether there is any good rationale for such a tax in the first place. It then goes on to evaluate the existing system and a number of alternatives that have been proposed. It argues that the existing system is fundamentally flawed, and that there is a need for radical reform. The key conclusion from the analysis is that there would be significant gains from a reform that moved the system towards taxing profit in the country in which a business made its sales to third parties. That conclusion informs two proposals that are put forward in detail and evaluated: the Residual Profit Allocation by Income (RPAI) and the Destination-based Cash Flow Tax (DBCFT).The book is authored by group of economists and lawyersthe Oxford International Tax Group, chaired by Michael P. Devereux. It draws insights from both economics and lawincluding economic theory, empirical evidence on the impact of taxes, and an examination of practical issues of implementationto assess the existing system and to consider fundamental reforms. This book will be useful to tax policy makers, tax professionals, academics, and anyone interested in tax policy.
Trade ReviewThe ability for a lay reader to distil (however broadly) some essentials about current and future approaches to international tax indicates an impressive marshalling of arguments in this most labyrinthine of areas. * Tom Proverbs-Garbett, Law Society Gazette *
The ideas contained in this book form important contributions to tax scholarship and are already shaping policy debates about the future of international tax cooperation. The book contains careful and detailed discussions of current and future reforms of the existing international tax system and of various alternatives proposed in the literature. * Laurens van Apeldoorn, Economics and Philosophy *
Table of Contents1: Introduction 2: Key issues in taxing profit 3: The current international tax system 4: Fundamental reform options 5: Basic choices in considering reform 6: Residual profit allocation by income 7: Destination-based cash flow taxation
