Mithe, Ameya
Critical analysis of the Principal Purpose Test and the Limitation on Benefits Rule a world divided but It takes two to tango Electrónico / Ameya Mithe .-- , 2020
Disponible únicamente en formato electrónico.
Resumen.
This article focuses on the principal purpose test (PPT) and the limitation on benefits (LOB) provision as two divergent treaty anti-abuse measures presented by BEPS Action 6 and the Multilateral Instrument (MLI). It first traces the evolution of both these measures. Thereafter, it discusses the diverse interpretations of the PPT and studies the double-step application of the LOB in light of the US approach and comments on the merit of a standalone application of each measure as opposed to their combined application in a treaty. The article subsequently observes that while Action 6 recommended a combined application of both measures, the country choices in the MLI show a polarized global implementation of these measures. Most countries (the European Union being at the forefront) prefer a standalone application of the PPT (without the LOB), while the US rejects the PPT and continues to exclusively apply the LOB provision. Lastly, the author proposes a solution to bridge this global divide.
FISCALIDAD INTERNACIONAL
ABUSO DE TRATADOS
CLÁUSULA DEL PROPÓSITO PRINCIPAL
LIMITACIÓN DE BENEFICIOS
CONVENIO MULTILATERAL
World Tax Journal v. 12, n. 1, 2020
Critical analysis of the Principal Purpose Test and the Limitation on Benefits Rule a world divided but It takes two to tango Electrónico / Ameya Mithe .-- , 2020
Disponible únicamente en formato electrónico.
Resumen.
This article focuses on the principal purpose test (PPT) and the limitation on benefits (LOB) provision as two divergent treaty anti-abuse measures presented by BEPS Action 6 and the Multilateral Instrument (MLI). It first traces the evolution of both these measures. Thereafter, it discusses the diverse interpretations of the PPT and studies the double-step application of the LOB in light of the US approach and comments on the merit of a standalone application of each measure as opposed to their combined application in a treaty. The article subsequently observes that while Action 6 recommended a combined application of both measures, the country choices in the MLI show a polarized global implementation of these measures. Most countries (the European Union being at the forefront) prefer a standalone application of the PPT (without the LOB), while the US rejects the PPT and continues to exclusively apply the LOB provision. Lastly, the author proposes a solution to bridge this global divide.
FISCALIDAD INTERNACIONAL
ABUSO DE TRATADOS
CLÁUSULA DEL PROPÓSITO PRINCIPAL
LIMITACIÓN DE BENEFICIOS
CONVENIO MULTILATERAL
World Tax Journal v. 12, n. 1, 2020