International Tax Planning in the Age of ICT

Arbeitspapier

The increased use of information and communication technologies (ICT) leads to new ways of doing business internationally. Nowadays, firm-specific intangible assets as well as services often constitute the most important factors for the creation of value. Besides, geographic distances tend to be less relevant. The main objective of international tax planning consists of minimising the effective tax rate of the whole company or group. In this paper, it is examined for several instruments of international tax planning whether new chances of minimising the effective tax rate emerge with the use of ICT and to what extent new risks occur. The analysis comprises the (re)location of a company?s residence, the (re)allocation of functions and risks, the implementation of a transfer pricing system, the choice of the form and location of investments abroad as well as hybrid forms of co-operation. For each instrument, both current and non-current tax issues are considered. We conclude that, due to ICT, it is easier to make use of the international tax differential by choosing the optimal location and form of investment and by allocating functions and risks. Thus, companies can pay more attention to the tax-optimal choice between international locations and the importance of this instrument to reduce the effective tax rate is further strengthened by the use of ICT.

Object Details

• Language: Englisch

References and Relationships

• Bibliographic citation: Series: ZEW Discussion Papers ; No. 04-27

Classification and Topics

• Classification: Wirtschaft ; Business Taxes and Subsidies including sales and value-added (VAT)
• Subject: International Company Taxation ; Tax Planning ; Information and Communication Technologies ; Electronic Commerce ; Steuerplanung ; international ; Multinationales Unternehmen ; Standortwahl ; Informationstechnik ; Computergestütztes Verfahren

Contributors, Places and Time

• Event: Geistige Schöpfung
• (who): Schäfer, Anne ; Spengel, Christoph
• Event: Veröffentlichung
• (who): Zentrum für Europäische Wirtschaftsforschung (ZEW)
• (where): Mannheim
• (when): 2004

Further information

• Handle: http://hdl.handle.net/10419/24034
• Last update: 10.03.2025, 11:45 AM CET