Published on 01 Oct 14
by "TAXATION IN AUSTRALIA" JOURNAL ARTICLE
Tax base erosion as a result of technologically-driven economic globalisation has emerged as a severe threat to national economies. The threat has given rise to the OECD’s Action plan on base erosion and profit shifting, and a new tax concept, to the effect that profits should be taxed where the “real activity” that generates them is occurring. In Australia, it is a common complaint that certain multinational corporations are shifting or otherwise transferring untaxed profits from their Australian operations to various entity structures in competitive tax regimes.
This article examines the validity of that complaint, in the light of the phenomenon of economic globalisation and its effects on transfer pricing rules and the traditional concepts of source and residence as the criteria of taxation liability
John is Barrister and Solicitor - The Supreme Court of Victoria.
Current at 1 October 2014
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