Tuesday, April 19, 2022
Shay: The Misleading Attract Of Taxing “Residual Earnings”
Stephen E. Shay (Boston Faculty; Google Scholar), The Misleading Attract of Taxing “Residual Earnings”, 75 Bull. Intl. Taxn. 527 (2021):
This text outlines the normal justifications for a residual income enterprise tax base and evaluates its function within the OECD/G20 Pillar One proposal to allocate revenue to market international locations. The article concludes that basing the allocation of income to market international locations on multinationals’ residual income could be inferior to allocating a portion of whole company income.
Conclusion
Taxing residual income garners enthusiasm on the drafting board, however it has but to ship on the promise held out by financial concept. The attract is misleading in relation to the truth. The attract is even additional eliminated in relation to Pillar One. There doesn’t look like a compelling motive to import residual-profit taxation into the Pillar One regime.
https://taxprof.typepad.com/taxprof_blog/2022/04/shay-the-deceptive-allure-of-taxing-residual-profits.html
