International double taxation - taxationtaxes of one person in relation to the same tax base in at least two states for the same period. This phenomenon has a fairly negative impact on the development of foreign trade relations, contributes to the difficulty of moving capital and impedes the development of integration economic processes. In addition, some business entities, trying to avoid an additional tax burden, are doing so successfully that they develop special schemes for minimizing tax liabilities.
Double taxation should not be confused withcumulation of tax, which is the taxation of several taxes of the same source (re-taxation). This may be the case when the object was previously taxed in favor of the state treasury.
The concept under consideration should also be distinguished fromdouble economic taxation, which arises during the taxation of profits as an independent payer, as well as taxation of its part from shareholders in the form of dividends. It is economic double taxation that can help minimize tax liabilities by transferring distributable profits in the form of dividends to foreign shareholders of their company (in accordance with the current legislation, tax is collected both at the location of the source of income and at the location of the resident).
The main reasons for thistaxation are collisions in the current tax laws of the countries participating in the legal relations between business entities for commodity transactions, operations with income and capital. These collisions arise from the fiscal direction of the state, in which the authorities fully and independently are engaged in establishing the objects of taxation, the range of their taxpayers, as well as the size and methods of levying tax deductions. The main criteria for determining the boundaries of tax jurisdiction are:
- Residency, meaning taxation of allincome of the resident, regardless of the location of sources (this term can also be found under the name "unlimited tax liability"). The incomes of non-residents are taxable only if they are received from the sources of the country;
- territoriality, which provides for the taxation of all income received in the territory of this country, and from all payers, regardless of their residence.
Elimination of double taxationis carried out in countries in different ways. So, some states build their economic relations with payers on the basis of residency, others - using the principle of territoriality.
Often, international double taxationis associated with the features of the definition of the subject. Especially when as a taxpayer it is simultaneously accepted by several countries. This is possible with the operation of residence rules in one state for a certain period of time when this business entity lives on the territory of that particular country, and in another - the taxation is carried out on the fact of finding a permanent residence in its territory.
In the elimination of such a negative indicator asdouble taxation, should be interested in both sides. Thus, a taxpayer significantly increases the tax burden when taxes and fees are levied in different countries of the same object. The interest of the state should be manifested in the creation of a favorable tax climate, attraction of foreign investments, as well as increasing competitiveness.
