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Int. J. Financial Stud. 2018, 6(1), 6; doi:10.3390/ijfs6010006

The Emerging International Taxation Problems

1
Department of Accounting & Finance Montclair, Montclair State University, Montclair, NJ 07043, USA
2
Stillman School of Business, Seton Hall University, South Orange, NJ 07079, USA
*
Author to whom correspondence should be addressed.
Received: 27 October 2017 / Revised: 15 December 2017 / Accepted: 19 December 2017 / Published: 2 January 2018
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Abstract

The problems of tax evasion and tax avoidance are as old as taxes themselves. Between 2015 and 2016 alone, many U.S. multinational corporations were involved in tax disputes with the European Commission. From a historical perspective, these disputes are unprecedented as they have resulted in tremendous amount of tax penalties. The most notable case was Apple for €13 billion of unpaid tax. This article discusses what tax strategies these corporations used that caused such disputes. It specifically investigates seven corporations: Apple Inc., McDonald’s, Starbucks, Fiat, Amazon, Google, and Ikea, and elaborates on the following tax strategies: high royalties, intercompany transfer pricing, intercompany loans, and source of income in a high-tech industry. This article also discusses the European Commission’s charges of tax evasion and how these corporations defend against them. When multinational corporations are operating abroad, they must observe not only domestic tax law but also international law. View Full-Text
Keywords: Keywords; international taxation; the European Commission; worldwide tax system; territorial tax system; domestic-sourced income; foreign-sourced income Keywords; international taxation; the European Commission; worldwide tax system; territorial tax system; domestic-sourced income; foreign-sourced income
This is an open access article distributed under the Creative Commons Attribution License which permits unrestricted use, distribution, and reproduction in any medium, provided the original work is properly cited. (CC BY 4.0).

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MDPI and ACS Style

Yang, J.G.S.; Metallo, V.N.A. The Emerging International Taxation Problems. Int. J. Financial Stud. 2018, 6, 6.

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Int. J. Financial Stud. EISSN 2227-7072 Published by MDPI AG, Basel, Switzerland RSS E-Mail Table of Contents Alert
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