Tax Policy Challenges in the 21st Century

S. 690I. Introduction

With reference to the considerations in the earlier chapters, the author has summarized his understanding about extractive industry (“EI”) and the related aspects pertaining to the topic. The author has analyzed the topic in the following manner:

• the concept, structure and current trends within EI;

• impact of transfer pricing in EI; and

• the role of tax havens within EI, with some facts and statistics which would give a holistic understanding about the industry.

Please note that there are certain facts and statistics that are based on the publicly available documents and the same are being referenced as notes in the respective paragraphs.

A. Extractive Industry

EI may be defined as a process that involves different activities, starting with extraction of raw materials from the earth (such as oil, metals, mineral and aggregates), followed by processing and utilization by consumers. The said process can either wholly or partly take place within the home or the host-country operating companies, as well as consuming markets. As a result of the process within EI, the ensuing global value chains, as well as the value distribution along the production chain and the stakeholders, ca...