A Study on Tax Issues for Taiwan Anti-Evasion Regimes of Controlled Foreign Corporations
Date Issued
2015
Date
2015
Author(s)
Ko, Chun-Long
Abstract
As the trend of global economic rapid development, international anti-avoidance measures have become an issue that the world major capital export countries would focus upon. The transfer pricing regulation, controlled foreign corporations rule(CFC), thin capitalization rule and place of effective management rule are good examples of such legislative provisions. Many countries enact the CFC rule that requires the passive income and certain other tainted income of foreign corporations controlled by resident shareholders to be included in the income of those shareholders, whether or not such income is distributed. During recent years, our nation has gradually migrated toward one of the capital exporter countries. Although our nation implanted profit-oriented enterprise transfer pricing compliance system in 2004 as well as thin-capitalization rule in 2011, there is still room for improvement in the area like preventing the CFC tax shelter delay effect. Hence under the ideal of tax system’s fairness and neutrality, it is necessary to set up the CFC income tax system. Since the United States of America is the first one who stipulates the related tax issues of CFC and is probably the broadest and the finest, the CFC income tax system of USA is of great value for comparison and reference. This thesis will explore the comparison between the CFC tax system of USA and the draft of Article 44-3 of Income Tax Act of Taiwan. There will be recommendations about the CFC rules, and the recommendations could be taken as a reference when enacting or amendment of the CFC tax system in the future.
Subjects
Anti-tax evasion
Controlled foreign corporations
American taxation
Tax reform
Type
thesis
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