Special Features of the UN Model Convention
1. Aufl. 2019
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1. S. 556Introduction
‘Tremendous progress in eliminating double taxation over time had resulted in part in the creation of double non-taxation’
Pascal Saint-Amans, Director of the Centre for Tax Policy and Administration of OECD
The 2017 United Nations Model Double Tax Convention between Developed and Developing Countries (UN Model) presented for the first time an anti-treaty shopping rule embedded in the Limitation on Benefits (LoB) clause. In the introductory part, I discuss why the United Nations decided to introduce the LoB clause. In the second part, I describe the LoB clause in the UN Model and compare it with LoB clauses in the 2017 OECD Model Tax Convention on Income and on Capital (OECD Model), the 2016 US Model Income Tax Convention (US Model), and the Multilateral convention to implement tax treaty related measures to prevent base erosion and profit shifting (MLI). In the final part, I analyse how developing countries might apply Artificial Intelligence (AI) to combat treaty shopping.
1.1. The Problem of Treaty Shopping
Initially, countries wanted to attract foreign investments and concluded tax treaties to eliminate tax obstacles and allocate taxing rights among two contracting S...