UDC351.713:336.226.12
MELNYK Yuri,
Postgraduate student of the Department of private international, commercial and civil law
of Kyiv National University of Trade and Economics
THE LEGAL FRAMEWORK OF TAX PLANNING
OF MULTINATIONAL CORPORATIONS
Background. The activities of the international corporations completely change the system of international business, forming new challenges and tasks for States and international organizations. One of the most threatening consequences of the internationalization of economic activity is tax planning, which is widely used by international corporations. Tax planning of multinational corporations is a process of using the differences in the tax legislation of the countries where are placed the companies, groups, for the legitimate reduction of the tax base. The practice of tax planning of multinational corporations today has more than 400 different schemes, which are constantly improving and become more complex.
Analysis of recent researches and publications. Problems of legal regulation of legal relations in the sphere of taxation in Ukraine and in the world is the object of research of such scientists as O. Minaieva, D. Piddubna, A. Salienkov, V. Marchenko, T. Tsymbal, Yu. Onishchuk, I. Pasichna. Some aspects of the reduction of the tax base have become the subject of research of such scientists as D. Getmantsev, I. Kucherov, M. Kucheriavenko, O. Nogyna, N. Onishchuk, I. Mizina.
The aim of the article is justification of improvement directions of legal regulation of multinational corporations’ tax planning on national and international levels.
Materials and methods. When writing scientific article, the optimal set of scientific and special scientific methods, including such methods as abstraction, deduction, analysis, synthesis, logical-legal, sociological, etc. is used from the point of view of the objectives of the study. The acts of current legislation of Ukraine and the EU, statistical, scientific and legal publications on tax planning of international corporations form the Empirical basis of the article.
The results of the study. A key stage in the research of legal regulation of tax planning of multinational corporations is the analysis of the major schemes that are widely used by corporations to substantially reduce the tax base. The working documents of the European Commission include the scheme of using offshore and hybrid loans, hybrid units, as well as intellectual property transactions, which are the most common in international practice. Basic schemes that are used by the international Corporations are the schemes of the offshore loan, hybrid loan (loans through hybrid financial instruments), patent box, duplex intellectual property etc.
Conclusion. The main problem of legal regulation of tax planning of multinational corporations is connected with the fact that taxpayers direct their activity in allowed by the law areas, thereby acting exclusively in the legal area. For Ukraine as for other countries, counteracting to tax planning of multinational corporations is extremely important. That is why in the beginning of 2017 Ukraine joined the four initiatives of the BEPS, although the amendments to the tax legislation in accordance with the terms of the initiatives are practically not carried out currently or are carried out rather slowly. Ukraine still has not expressed any intentions regarding the implementation of the rules of Controlled foreign companies or rules that make it impossible to prevent registration of a permanent establishment. The implementation of the norms for the automatic exchange of information about non-resident financial accounts according to the International Standard (Common Reporting Standard), which will begin to operate according to official reports of the Ministry of Finance from 2020, is slowly being implemented.
Keywords: international corporations tax planning, legal regulation, dilution tax base erosion, BEPS, thin capitalization rule.
FREE FULL TEXT (PDF)