Browsing by Subject "Kansainvälinen verotus"

This thesis investigates the tax base and allocation choices in international corporate income tax architecture and provides an evaluation of the effects of the choices made in three different systems: the current system, residual profit allocation, and OECD Pillar One. International corporate income tax design has a significant effect on the functioning of the international economy and on the welfare of individuals. Thus, making the correct design choices is extremely important. This thesis argues that the international corporate income tax system should be designed following certain important principles of taxation: 1) fairness, 2) economic efficiency, 3) robustness to avoidance, 4) administrative ease, and 5) incentive compatibility. The different systems are then introduced in turn and evaluated against these criteria. The thesis finds that the current system suffers from certain conceptual weaknesses that leave significant room for improvement with regards to the set criteria. It is further argued that a reform is required for the continued functioning of the international system. Such a reform could be introduced in the form of residual profit allocation. OECD Pillar One proposal involves elements of residual profit allocation, but in comparing the different systems with each other, this thesis argues that the OECD proposal is too narrow in scope to gain the full benefits of a residual profit allocation system.