In International Tax Design, companies use the low tax rates in other countries. For example, you set up patent companies and licensing companies in the Bahamas, Cayman Island, British Virgin Islands and Bermuda. In addition, corporations use foreign financing companies to move profits abroad. The German legislature has now introduced the additional taxation, the interest rate barrier and the license barrier.

In the video, we explain to you how corporations shift their profits to low-tax countries by granting licenses and thereby save considerable taxes.

1st Introduction to International Tax Design

In recent years, international tax design has come under increasing criticism. The main reason for this is likely to be the numerous corporations such as VW AG, BMW AG, Apple Inc. or Google Inc., which act as global players and exploit the tax options at international level up to the maximum design volume. As a result, large-scale profits are transferred from the country of residence or the country where the operations take place to countries that have a minimum or even no tax rate. As a result, the resident states lose tax revenue in a not insignificant amount.

Politicians are constantly trying to restrict or completely prevent these design possibilities through targeted legislation. Far-reaching measures, such as the so-called “licensing barrier”, were adopted by the legislature.

But here the question arises as to what these international tax design possibilities can look like, what mitigation measures have been created and to what extent the measures of the legislature have an impact on national companies.

In this article, the author deals with the concept of international taxation at the beginning. He represents this in general and by means of theoretical examples.

Furthermore, the work focuses on the essential provisions of selected legal measures to curb international taxation.

Last but not least, the author deals with brief hypothetical remarks about the impact on national companies.

To answer the question of the concept of international tax design, the author first goes into the concept of international tax law.

The question of the concept of international tax law and the understanding down here is not exactly defined in the literature. [1] Decisive for this are the various views that have always been valid. For this reason, the concept of international tax law has been controversial from the outset. [] 2]

According to the opinion of Isay described by Schaumburg, he considers that international tax law serves to regulate the fiscal deficits between two states. [3] Accordingly, he distinguishes “positive” and “pure” international tax laws: Positive international tax law means domestically shaped international tax law. [4] Pure international tax law, on the other hand, serves to capture all tax matters that go beyond its own territory. [] 5]

In the opinion of the author, this is where the international tax structure comes in. Through targeted design advice, especially for international companies, taxes as an investment criterion can be decisive for an investment. [6] Accordingly, with regard to the prior implementation, the term international tax structure is understood to mean the optimal interpretation of international tax regulations in order, inter alia, to optimally plan investments or investments in companies through targeted reduction of taxation. ensure location planning.

2.2. International tax design through multinational lending

It is factually proven that money as a financial means is very flexible and can be moved with little effort. This development of money makes it easy, especially for multinational corporations, to achieve tax advantages through targeted adjustment of the debt structure. [7] Risks arise mainly in the following constellations:[ 8]