International Corporate Tax Planning

Ulrich Schreiber
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Ulrich Schreiber: University of Mannheim

Chapter 3 in International Company Taxation, 2013, pp 51-98 from Springer

Abstract: Abstract Multinational corporate groups engage in tax planning to increase after-tax cash flows and the groups’ market value. In the first place, international tax planning aims at avoiding legal double taxation. In second place, international tax planning focuses on tax arbitrage. Avoidance of double taxation is the first priority of international tax planning because double taxation of profits severely reduces a multinational group’s profitability. A multinational group’s legal structure responds to double taxation problems and reflects the international allocation of taxing rights. Nevertheless, intra-group transactions may give rise to double taxation as tax bases may overlap when different countries apply different rules to determine the tax base (e.g. when assessing transfer prices).

Keywords: Cash Flow; Transfer Price; Foreign Subsidiary; Finance Company; Permanent Establishment (search for similar items in EconPapers)
Date: 2013
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DOI: 10.1007/978-3-642-36306-1_3

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