Non-Discrimination in European and Tax Treaty Law
1. Aufl. 2015
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I. S. 378Introduction
This thesis examines the correctness of the potential approaches to progression which can be adopted by the source State for determining the progressive scale of tax rates to be applied in calculating the taxation on the profits of a permanent establishment (PE).
The text of Article 24(3) has remained unaltered since its first introduction in the OECD MC 1963. Article 24(3) of the OECD MC 2014 is worded as follows:
The taxation on a permanent establishment which an enterprise of a Contracting State has in the other Contracting State shall not be less favourably levied in that other State than the taxation levied on enterprises of that other State carrying on the same activities. This provision shall not be construed as obliging a Contracting State to grant to residents of the other Contracting State any personal allowances, reliefs and reductions for taxation purposes on account of civil status or family responsibilities which it grants to its own residents.
It is apparent that the PE is not a separate legal entity by itself, but it is instead only a part of an enterprise that has its head office in another State; hence, it is the enterprise of the other State which cou...