You are a partner in a Tax Consulting firm. Your firm has recently employed 5 new staff and they have to be trained on a number of issues.
Required:
Prepare a presentation on international taxation with emphasis on FIVE (5) objectives or goals of international taxation treaties. (10 marks)
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A treaty is an international agreement concluded between states in written form and governed by international law, whether embodied in a single instrument or in two or more related instruments and whatever its particular designation
International taxation is the taxation of transaction of transactions across borders. This places a burden on taxpayers involved in international transactions.
Tax treaties are arrangements aimed at reducing the tax payers of taxpayers and crafting a common path between and among countries with tax treaties. Example of tax treaties is double taxation.
Objectives of tax treaty
- It is designed to achieve the following five goals
- It allows the allocation of tax between treaty partners
- It creates fiscal certainty which encourages investment across countries in the treaty areas
- It is to eliminate international tax evasion and aggressive tax avoidance
- It is aimed at reducing tax burden
- It deepens international relations