Corporate taxation: New rules, same old paradigm

UK Only Article: 
standard article

Issue: 

Eradicating disease

Fly Title: 

Corporate taxation

Rubric: 

A plan to curb multinationals’ tax avoidance is an opportunity missed

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IN 2013 investigators from America’s Senate shone a harsh light on a highly profitable unit of Apple that was registered in Ireland, controlled from America—and not paying tax in either country. That this “stateless-income” structure was perfectly legal highlighted a big loophole in the global system for taxing multinationals.
There are many such gaps, and the reason is that the patchwork of national rules and bilateral treaties governing how much tax companies owe, and to whom, is horribly dated. It was designed for the manufacturing age. Business today is increasingly digital, services-based and driven by intangible assets, including rights to exploit intellectual property (IP), from patents to logos. These are easier than physical assets to shuffle from subsidiaries in high-tax countries to …
Source: The Economy