Thin Capitalization Rules in EU Member States
Thin capitalization rules fit in the group of the specific anti-avoidance rules (SAAR) which are legalised by domestic tax laws. Anti-avoidance measures attempt to strike down unacceptable tax avoidance practices that have taken place with the increasing importance of multinational firms. In contras...
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| Format: | Article |
| Language: | English |
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University of Ljubljana Press (Založba Univerze v Ljubljani)
2011-06-01
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| Series: | Central European Public Administration Review |
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| Online Access: | https://journals.uni-lj.si/CEPAR/article/view/20334 |
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| _version_ | 1832591508334706688 |
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| author | Tatjana Ðukić |
| author_facet | Tatjana Ðukić |
| author_sort | Tatjana Ðukić |
| collection | DOAJ |
| description | Thin capitalization rules fit in the group of the specific anti-avoidance rules (SAAR) which are legalised by domestic tax laws. Anti-avoidance measures attempt to strike down unacceptable tax avoidance practices that have taken place with the increasing importance of multinational firms. In contrast to local firms, multinational corporations can shift profits to lower taxed foreign locations, leading to substantial losses in tax revenue. The article presents a systematic review of thin capitalization rules in EU 27, summing up four most common approaches of thin capitalization regulation. The analysis revealed that the majority of countries (15) legalised the fixed ratio approach, one quater (7) the subjective approach and only a few (3) legalised the hidden profit distribution. Two of them have improved thin-cap rules to so called earningstripping rule. |
| format | Article |
| id | doaj-art-50058c3f72d04b1eb8463539ef17159b |
| institution | Kabale University |
| issn | 2591-2240 2591-2259 |
| language | English |
| publishDate | 2011-06-01 |
| publisher | University of Ljubljana Press (Založba Univerze v Ljubljani) |
| record_format | Article |
| series | Central European Public Administration Review |
| spelling | doaj-art-50058c3f72d04b1eb8463539ef17159b2025-01-22T10:55:19ZengUniversity of Ljubljana Press (Založba Univerze v Ljubljani)Central European Public Administration Review2591-22402591-22592011-06-019210.17573/cepar.v9i2.177Thin Capitalization Rules in EU Member StatesTatjana ÐukićThin capitalization rules fit in the group of the specific anti-avoidance rules (SAAR) which are legalised by domestic tax laws. Anti-avoidance measures attempt to strike down unacceptable tax avoidance practices that have taken place with the increasing importance of multinational firms. In contrast to local firms, multinational corporations can shift profits to lower taxed foreign locations, leading to substantial losses in tax revenue. The article presents a systematic review of thin capitalization rules in EU 27, summing up four most common approaches of thin capitalization regulation. The analysis revealed that the majority of countries (15) legalised the fixed ratio approach, one quater (7) the subjective approach and only a few (3) legalised the hidden profit distribution. Two of them have improved thin-cap rules to so called earningstripping rule.https://journals.uni-lj.si/CEPAR/article/view/20334thin capitalizationtax revenueanti-avoinance rulesEUtax authority |
| spellingShingle | Tatjana Ðukić Thin Capitalization Rules in EU Member States Central European Public Administration Review thin capitalization tax revenue anti-avoinance rules EU tax authority |
| title | Thin Capitalization Rules in EU Member States |
| title_full | Thin Capitalization Rules in EU Member States |
| title_fullStr | Thin Capitalization Rules in EU Member States |
| title_full_unstemmed | Thin Capitalization Rules in EU Member States |
| title_short | Thin Capitalization Rules in EU Member States |
| title_sort | thin capitalization rules in eu member states |
| topic | thin capitalization tax revenue anti-avoinance rules EU tax authority |
| url | https://journals.uni-lj.si/CEPAR/article/view/20334 |
| work_keys_str_mv | AT tatjanaðukic thincapitalizationrulesineumemberstates |