Basic Principles of International Taxation

The basic principles of international taxation include: the principle of national tax sovereignty; the principle of fairness in the distribution of international taxes; and the principle of international tax neutrality. The rules of international taxation need to address the question of at what standard income from cross-border transactions is taxed and how the right to tax is distributed among countries.

International taxation is a general term for a series of tax law norms that tax the behavior of cross-border transactions carried out between two or more countries.

Importance of International Taxation

1, to make up for the shortcomings of the domestic tax laws in unilaterally solving the problem of international double taxation;

2, to take into account the tax interests of the country of residence and the country of source;

3, to strengthen the international cooperation in the prevention of the problem of international tax avoidance and international tax evasion.

Contents of International Coordination of Taxation

The contents of international coordination of taxation involve tax jurisdiction, tax system, tax policy and tax cooperation.

(1) Tax jurisdiction is the exclusive tax collection and management power of every sovereign state, and when tax jurisdiction crosses and conflicts, it is necessary for all parties to resolve the conflicts through tax international coordination.

(2) Different countries have different historical stages of economic development, different levels of economic development, there will be differences in the tax system. Differences in tax systems are not conducive to the normal development of international economic and trade relations, and it is necessary to optimize the tax system through international coordination of taxation.

(3) As the influence of tax policies of different countries can lead to the artificial flow of economic resources, it is necessary to promote the adoption of consistent tax policies by all countries in the world on major issues through international coordination of taxation.

(4) With the deepening of international dependence, the flow of goods, capital, personnel and information is very frequent, which makes the tax authorities of various countries endeavor to plug loopholes and reduce tax losses through tax information exchange, exchange of senior tax personnel and strengthening of cooperation in transnational tax administration.