The Resource The principal purpose test (PPT) in BEPS Action 6 and the MLI : exploring challenges arising from its legal implementation and practical application

The principal purpose test (PPT) in BEPS Action 6 and the MLI : exploring challenges arising from its legal implementation and practical application

Label
The principal purpose test (PPT) in BEPS Action 6 and the MLI : exploring challenges arising from its legal implementation and practical application
Title
The principal purpose test (PPT) in BEPS Action 6 and the MLI : exploring challenges arising from its legal implementation and practical application
Creator
Subject
Language
eng
Summary
This study contains a comprehensive, in-depth analysis of the principal purpose test (PPT) designed by the Organization for Economic Cooperation and Development (OECD) as part of the BEPS Action 6 Final Report, "Preventing the Granting of Treaty Benefits in Inappropriate Circumstances". Unsurprisingly, the PPT was adopted by all signatories to the Multilateral Convention to Implement Tax Treaty Related Measures to Prevent Base Erosion and Profit Shifting (MLI), setting out a minimum standard in accordance with the Action 6 Final Report. Once the MLI is ratified by the legislatures of signatories, it will apply to more than 2,000 treaties. From this perspective, not only does the PPT constitute the most important anti-treaty abuse rule under the MLI, but it also secures a 100% match between the tax treaties of the signatories. All the same, one may ask whether the PPT will prevent treaty abuse with a sufficient degree of precision and without giving too much discretion to tax authorities. If this is not the case, the principles of legal certainty and legality of taxation may be jeopardized, and the June 2017 victory of the executives may turn into a failure at the level of legislatures and/or jurisprudence in the near future. This article represents an attempt to map this unexplored terrain by undertaking a comprehensive analysis of the PPT in Action 6 and in the MLI with a view to examining the potential challenges arising from its legal implementation and application in respect of the PPT. Where appropriate throughout the article, alternative solutions will be proposed
Citation source
In: World tax journal. - Amsterdam. - Vol. 10 (2018), no. 2 ; p. 233-294
http://library.link/vocab/creatorName
Kuźniacki, B
Geographic coverage
International
Language note
English
http://library.link/vocab/subjectName
  • principal purpose test
  • BEPS Project (OECD)
  • MLI
  • tax treaty
  • treaty abuse
  • treaty shopping
Label
The principal purpose test (PPT) in BEPS Action 6 and the MLI : exploring challenges arising from its legal implementation and practical application
Instantiates
Publication
Label
The principal purpose test (PPT) in BEPS Action 6 and the MLI : exploring challenges arising from its legal implementation and practical application
Publication

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