Traditional treaty principles that allocate taxing rights between residence and source states, which have long formed the cornerstone of international tax consensus, are undergoing rapid re-evaluation, writes Jonathan Schwarz (Temple Tax Chambers)
The impact of BEPS on future tax treaties cannot be underestimated. Traditional principles for the allocation of taxing rights between residence and source states which have formed the cornerstone of international tax consensus for almost a century are undergoing rapid re-evaluation.
At its core Action 6 headlined as preventing treaty abuse sets out a catalogue of proposals designed to prevent the granting of treaty benefits in circumstances now regarded by the drafters as inappropriate. This is underscored by Action 2 which aims to eliminate the double non-taxation double deductions and long-term deferral that arise through hybrid...
