Research On Tax Risks Of Non-resident Enterprise’s Permanent Establishment In The Post-BEPS Era

In the contemporary society,capital globalization is developing in depth,and more and more non-resident enterprises are engaged in production and operation activities on a global scale.Consequently,the issue of permanent institutions has become one of the major concerns of tax authorities.At the same time,with the emergence of the digital economy and the gradual implementation of new business models and BEPS achievements in various countries,non-resident enterprises themselves also pay special attention to the relevant tax issues they may be involved in.Under such a background,the paper intends to adopt the case analysis model to deeply explore the relevant tax risks of permanent institutions of non-resident enterprises in the post-BEPS era.Then general suggestions on optimizing the tax risk prevention mechanism of non-resident enterprises in the post-BEPS era are put forward from the two aspects of countermeasures of non-resident enterprises themselves and suggestions on improving the BEPS action plan.In this paper,the latest tax agreement model and the relevant provisions of permanent institutions in China’s tax law are reviewed.The paper defines the concrete connotation of "post-BEPS era",summarizes the new characteristics of tax policies of permanent institutions of non-resident enterprises in the "post-BEPS era" compared with the "pre-BEPS era".The proposed amendments to the permanent institutions principles in the latest BEPS action plan are interpreted.Also the paper briefly introduces the tax risks faced by permanent institutions and provides policy basis for the case analysis of this paper.Then,starting from China’s tax practice,this paper focuses on the analysis of the tax risks of permanent institutions that may be involved in the business arrangement of S company in China in the post-BEPS era,and finds that there may be the following tax-related risks:in the sales mode of "live broadcasting + e-commerce",there are tax risks that constitute permanent institutions of fixed places;there are tax risks in the sales agency business that constitute fixed place and agency permanent institutions;There are tax risks in cross-border labor dispatch business that constitute permanent service organizations.Finally,on the basis of risk identification and analysis,S company is promoted to all non-resident enterprises,and general suggestions are put forward for optimizing the tax risk prevention mechanism of permanent institutions of non-resident enterprises in thepost-BEPS era.On the one hand,the tax risk prevention measures for non-resident enterprises themselves,the main consideration is to enhance the independence of business activities of non-resident enterprises in the sales mode of "live broadcasting+ e-commerce",set up representative offices for auxiliary work in the sales agency business,specify the dispatch contract in the arrangement of cross-border labor dispatch and avoid non-resident enterprises becoming actual employers.On the other hand,it puts forward some suggestions on the improvement of BEPS action plan under the background of post-BEPS era,they includes taking the server directly or indirectly involved in the business activities of enterprises as one of the criteria for judging the permanent organization,introducing the specific "virtual permanent organization" judging principle,including "low-risk dealers" into the scope of agency permanent organization and other policy suggestions.