The Firm as an Enterprise Entity and the Tax Avoidance Conundrum: Perspectives from Accounting Theory and Policy
Biondi, Yuri (2017), The Firm as an Enterprise Entity and the Tax Avoidance Conundrum: Perspectives from Accounting Theory and Policy, Accounting, Economics and Law, 7, 1. 10.1515/ael-2017-0001
TypeArticle accepté pour publication ou publié
Nom de la revueAccounting, Economics and Law
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Résumé (EN)Notwithstanding its political dimension, international tax avoidance is also the result of a regulatory process that makes reference to overarching concepts and representations. The current debate is featured by two overarching principles of ‘negative’ and ‘positive’ taxation under the law: the one arguing for the right to minimise the tax payment, the other one for the duty to pay a fair tax amount. This debate is further featured by two distinctive approaches to tax base determination: the market basis coupled with the legal person basis, and the economic substance basis. The economic substance approach argues that the received approach grapples with economic reality featured by integrated transnational corporate groups. These groups operate across jurisdictions and have the capacity to reshape their legal-economic structuring to obtain specific tax results. An adequate response urges then to consider these groups through consolidated report (unitary approach), allocating their consolidated result to involved jurisdictions through formulary apportionment. This unitary approach is upheld by recent advances by the theory of the firm as enterprise entity, which combines law and economics with accounting. The business firm is then understood as a specific economic coordination backed by its institutional structure of production, including its accounting system. This theoretical consistency is appealing and deserves further investigation, including to foster cross-fertilisation and harmonisation of financial and tax accounting systems. But it does not imply a straightforward claim to adopt current international accounting standards for tax purposes. International accounting standards-making has been formally disconnected by national jurisdictions, it currently excludes public policy concerns, and it may be substantially unable to avoid the very same ‘specifications’ on the letter of the law that have been already paving the way to loopholes and structuring opportunities in tax regulation.
Mots-cléstax avoidance; global wealth chains; multinational companies
Affichage des éléments liés par titre et auteur.
Equilibrium and System Analysis in Economic Dynamics. A Comment on the “Guidance of an Enterprise economy” by Martin Shubik and Eric Smith Biondi, Yuri (2019) Article accepté pour publication ou publié