Global Trends in VAT/GST and Direct Taxes

S. 380I. Introduction

In the aftermath of the financial crisis the collapse of tax revenues, driven by output contractions and countercyclical fiscal policies to sustain the economy, has resulted in an increase of the public debt in countries around the world. In the light of the idea that a high debt-to-GDP ratio results in lower growth, many countries, especially in the European Union, started looking for ways to boost revenues and diminish the public debt through austerity measures. Among these measures can be included the crackdown on aggressive tax planning, the resulting BEPS Project, and the fight against tax avoidance in general.

The aim of this paper is to analyze the measures to fight tax avoidance. Since in this article space is a ‘scarce resource’, the paper will not deal with specific anti-avoidance rules (SAAR) but will focus on general anti-avoidance rules (GAAR) and anti-avoidance judicial doctrines, differentiating between direct and indirect taxation. The paper analyzes the case law of the European Court of Justice (ECJ). Moreover, the GAARs/anti-abuse concepts of Australia, Canada and the US will be discussed. The countries selected for the discussion were chosen for the...