Bericht

Taxing the residual profit of multinational enterprises: A critique of formulaic apportionment and a proposal

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According to plans put forward by the OECD/G20 Inclusive Framework on BEPS, a share of residual profit earned by eligible MNEs is to be taxed by market jurisdictions. For this purpose, revenue-based formulaic apportionment of residual profit is proposed. This note argues against the use of a rule requiring the multilateral assessment of MNEs' worldwide profit and recommends an alternative method of sharing taxing rights with market jurisdictions. The proposed method relies on unilateral profit splitting and is suggested by the application of Shapley value theory to the fair and equitable division of taxing rights between cooperating jurisdictions.

Sprache
Englisch

Erschienen in
Series: EconPol Policy Brief ; No. 35

Klassifikation
Wirtschaft
Business Taxes and Subsidies including sales and value-added (VAT)
Accounting and Auditing: Government Policy and Regulation
Multinational Firms; International Business
Thema
BEPS Project
Pillar One
formulaic apportionment
profit splitting
cooperative game theory

Ereignis
Geistige Schöpfung
(wer)
Richter, Wolfram F.
Ereignis
Veröffentlichung
(wer)
ifo Institute - Leibniz Institute for Economic Research at the University of Munich
(wo)
Munich
(wann)
2021

Handle
Letzte Aktualisierung
10.03.2025, 11:42 MEZ

Datenpartner

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Objekttyp

  • Bericht

Beteiligte

  • Richter, Wolfram F.
  • ifo Institute - Leibniz Institute for Economic Research at the University of Munich

Entstanden

  • 2021

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