The Study Of Legal Regulation On Off-shore Companies' International Tax Evasion

Since the middle of the last century,offshore company with its unique advantages has been active in the arenas of international investment and trade and has been widely favored by investors and business operators.At present there are approximately one million offshore companies all over the world.Offshore company,to a certain extent,has in turn boosted international trade and international investment.However,the offshore company inevitably has also brought a series of negative effects,such as being an international money-laundering tool,a transfer point for capital evasion,and tax havens etc.Especially,the cross-border tax avoidance activities are very common among offshore companies and are also international investors' main intention of setting up offshore companies. Offshore company's international tax avoidance activities have caused substantial revenue loss to the relevant high-tax countries and have seriously damaged the financial base of many countries.Due to the special characteristic and complexity of offshore companies,how to effectively regulate offshore companies has become a problem that plagues countries around the world.China is also facing the same problem.As China has gone further and further on the journey of reform and opening up,China's absorption of foreign capital has experienced an unprecedented development.Substantial foreign investment has come to China to engage in international tax avoidance activities by setting offshore companies.However,China's legal regulation system against offshore company has lagged far behind the developed countries,and even in some areas there are still blank.Therefore,this article takes the legal regulation of off-shore companies' international tax avoidance of as the research target,by analyzing relevant provisions in the filed of anti-avoidance and anti-harmful tax competition in developed countries and international organizations,and then combined with the present situation of off-shore company's tax avoidance as well as relevant legislation in China,and at the end proposing recommendations on how to set up and improve China's legal regulation system against off companies' tax avoidance activities.The whole dissertation can be divided into four chapters.The main contents are as follows:Chapterâ… mainly paves the way for the study below basic concepts,including introducing the basic concepts,functions of offshore companies as well as the modes and models of its international tax avoidance activities.Besides,the chapter also reasons the necessity of legal regulation on offshore companies' international tax avoidance,as the premise of a comprehensive study on relevant legal regulation in the later chapters.Chapterâ…¡is to study the relevant legal regulation system on the domestic level, including the general anti-avoidance measures,Transfer Pricing Rules and Tax Havens Counter-measures System,which are the representative legislature power of the current regulatory systems.The author takes the advanced legislation system the developed countries as model to conduct in-depth studies,which lays a theoretical basis for the introduction of the system to China's legislation.In addition,this chapter also includes the offshore jurisdiction's willingness to tighten the policies due to international pressure,which is the regulation from the starting point,thus will potentially become the most effective regulation method.Chapterâ…¢introduces the relevant regulatory system at the level of International Law.Main research targets are the reports and templates of Organization for Economic Co-operation(OECD).At the end of this chapter,there's a prediction of the prospect of OECD anti-harmful tax campain.One argument that runs through the whole chapter is that the regulation of offshore companies' tax avoidance and their activities must rely on international cooperation.Chapterâ…£first sums up China's relevant legal regulation process,and then emphasizes on how to set up and improve China's offshore company legal regulation system on the basis of the study in previous chapters,as well as on how to further conduct international cooperation on the issue.Particularly worth mentioning are the implementation of new "Enterprise Income Tax Law" is a landmark legislative leap, but it is just a beginning.The problem of offshore companies' tax avoidance has not been effectively resolved.Therefore this paper also strongly recommends that our country finally establish a comprehensive legal regulatory system against offshore companies' tax avoidance.