Customary International Law and Tax Jurisdiction
Céline Braumann
Little attention has been paid to the pervasive effects of customary international law in contemporary issues of international taxation. Customary international law influences states’ bargaining power in treaty negotiations, serves as a gap-filler for issues not regulated by treaties, and informs the interpretation of tax treaties by judges and administrative agencies. This study represents the most comprehensive and robust empirical analysis of customary international tax law to date. It adds the - formerly absent - voice of a public international lawyer to the conversation.
Using a novel and carefully theorized methodology for the identification of customary international law concerning international tax law, the author approaches the subject through an assessment of three crucial jurisdictional issues:
the nexus principle, which specifies how a state must be connected to a subject or object to exercise tax jurisdiction;
the norms that govern the cross-border taxation of corporate business profits; and
the nexus of ownership and control and, by extension, the role of the corporate veil in contemporary international tax law.
A central contribution of this book is its new data set that compares the relevant practice of 80 states, providing a much larger and more geographically representative sample than any previous study. The book also includes an in-depth discussion on how customary limits to tax jurisdiction relate to current reform proposals spearheaded by the OECD/G20 Inclusive Framework and by the UN General Assembly, as well as unilateral measures such as digital services taxes. It thereby furnishes new insights to the debate on their conformity with or divergence from the normative status quo of international tax law.
At its core, this book seeks to foster intra-disciplinary dialogue between international tax lawyers and public international lawyers by offering an accessible analysis of a complex interaction; a feature that will benefit academics, practitioners and policymakers in both fields.