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Resarch About Thin Capitalization In International Tax Law

Posted on:2009-08-21Degree:MasterType:Thesis
Country:ChinaCandidate:R J YangFull Text:PDF
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Since the 1970s, International investment and transnational corporations make rapid development, has become an important content and main driving force of economic globalization. To maximize the overall interests of enterprises, transnational investors often use all the difference to the tax system to reduce tax burden unfairly, resulting in international tax avoidance, seriously damage the national interests of the revenue and the normal order of fair competition, damage the impact of the tax regulation. Common modes of international tax avoidance inculd:international transfer pricing, abuses the international tax convention, set up the base company to avoid taxes and so on. In recent years, along with international capital movement quickening, one new way to avoid taxes appears: thin capitalition. The differential tax on interest and dividends is the reaon to prompted investors weaken capital. To solve this problem, many countries have developed specialized rules to limit the capital dilution non-resident investors Debt Financing, Enterprise Income Tax Law of the People' s Republic of China has benn into force in January 2008, and made explicit provisions. However, compared with developed countries, experience in dealing with thin capitalition is inadequate, It is necessary to strengthen the resarch of thin capitalition, construct thin capitalition system suitable for China. This paper is divided into three sections:The first chapter has studied thin capitalition. This chapter is divided into three sections: section I discussed the reasons for the occurrence of capital dilution, and endanger their definitions, SectionII studycapital dilution system , mainly discuss the scope of the tax system, compare Weakening capital with transfer pricing system , SectionIII study the difference of respond to thin capitalition of different countries.The second chapter study thin capitalition tax system of the United States, Britain, Germany and Focus on the Characteristics of thin capitalition of the tax system as well as the inspiration of the establishment of China' s thin capitalition system.The third chapter discus the establishment of China's national conditions for the thin capitalition system. Section 1 discus legislative problems of the country's thin capitalition, Section II study provisions of thin capitalition in the new income tax law , Section III discusses the establishment of China' s capital dilution should pay attention to the issue of taxation, and normal trading law is also considered to be added in a fixed proportion method .
Keywords/Search Tags:thin capitalization, International tax avoidance, Fixed ratio methd, Normal transactions methd
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