The Study Of Legal Regulations Against Offshore Company's International Tax Avoidance

Offshore company is an important legal phenomenon in the international capital market. Due to the separation of its registration and operation , an offshore company is necessarily regulated by laws of many countries but not totally controlled by a single country. In the background of economic globalization, transnational investors set up offshore company in offshore jurisdictions for maximizing profits, by this way they could avoid cross-border tax. As offshore companies are unique, complex and natural advantages, the offshore company's international tax avoidance resulted in the loss of substantial revenue in China, serious damage to China's tax base, how to regulate effectively offshore international tax avoidance, has become an urgent problem that China should face. This paper produces a set of recommendations on how to set up and improve China's legal regulation system against offshore company's tax avoidance activities, by analyzing relevant laws and regulations in developed countries and international organizations, and then combined with the present situation of offshore company's tax avoidance as well as relevant legislation in China. This article is divided into three chapters.Chapterâ… define the concept of offshore companies, offshore company legal characteristics, the difference between offshore companies and multinational corporations, analyze the nature of international tax avoidance, the various ways in the international tax avoidance, the model of offshore company's international tax avoidance on this basis is described in detail, in order to lay a theoretical foundation for later.Chapterâ…¡analyze in detail the various laws, regulations and policies against offshore company's tax avoidance activities from the unilateral, bilateral and multilateral point of view at different levels. In the unilateral regulation, the author elaborates the related laws and regulations of the United States, Britain, Japan and Germany, focus on The Controlled Foreign Company Rule of countries canceled deferral of paying tax policy and regulation of transfer pricing system. The purpose is to take these developed countries advanced legislation as a model and lay the theoretical foundation for Chapterâ…¢which China set up and improve China's legal regulation system against offshore company's tax avoidance activities.The regulation of offshore companies' tax avoidance and their activities must rely on international cooperation. So the author elaborates the international bilateral cooperation and the international multilateral cooperation present situation, and then emphasize on OECD"competition report of the harmful tax revenue","Agreement on Exchange of Information on Tax Matters"and"Multinationals and Tax Authorities on Transfer Pricing Guidelines", also analyses the European Union and other international organizations to regulate offshore companies' tax avoidance and their activities status.Chapterâ…¢analyze the present legislation situation against offshore company's tax avoidance activities, lay emphasis on the new Company Income Tax Law implemented on January 1, 2008, points out several defects of relevant legislation, the paper make some advice to perfect relevant legislation: consummate the Controlled Foreign Company Rule and Transfer Pricing system, consummate relevant laws , strengthen international cooperation against offshore company's tax avoidance activities.