BEPS Analyze

In the most agressive cases we have the tax fraud, that consists in a
act that directly infringe the law, also called tax evasion. This contra legem
situations allows the imposition of sanctions in the infringing agent. Whereas the
tax planning mostly adopted by the multinacionals, is a set of parameters that is
not against the law, because of that, there is no possibility to impose sanctions to
this corporations, prevailing the soft law rules.

In this context, the multinationals benefits from a low taxation, also

commonly called tax avoidance or agressive tax planning, resulting in a fair or
non fair tax collection in the countries.

As a example, the BEPS Project in the Action 12 iniciate to

encompass behaviors, that altought is legal and non abussive or artificality, can
put in risk the survival of fiscal state and the base notion of justice. This consistis
in a moral rule, that now has been brought to the International mechanisms of
law.

The OCDE work in the BEPS initialize with a meeting in G20 in

México, ocassion that a report has been published about base erosion and profit
shifiting indicating six key areas of concern: i) the mismatches in entity and
instrument characterization; ii) taxing profits from the delivery of digital goods
and services (that has been analyzed in this work); iii) intra-group debt financing
and captive insurance (also has been analyzed below); iv) transfer pricing; v) anti-
avoidance measures, in particular, about CFC rules, that consists in action
number 3 of BEPS Project; vi) harmful preferential regimes, or tax heavens.

The BEPS Project brings in his bulge a set of 15 Actions, that we will
try to, show, in our vision, the most importante ones.

The first action consists in the adress the tax challenges of the digital
economy. Each country has his on tax system, and sometimes, this can cause in
double taxation. This action comes up to fill the gaps in the domestic tax law,
trying to complement rules.

The action number 4, is to limit base erosion via interest deductions

and other financial payments. This arise because MNEs (multinacional
enterprises) make debt shifting, exploiting the domestic tax system. They tend to
finance their filliates that are residents in a high-tax state using excessive external
debt. As consequence, the deductible payments are used to reduce the profits that
are taxable in the high-tax coutry.
 The action 6, has the objective fight against the treaty shopping, the
concept of this term is described in the BEPS Project: as a person who is a non-
resident of a contracting state attempt to obtain benefits that the domestic tax law
secures only to residentes. Also, the BEPS Project brings the artificiality concept,
in the attempt to avoid abusive conducts. In the legal literature many authors
criticize this concept, because “artificality” is a indeterminate concept occasion
that brings juridical insecurity. Because of that the means legis of the legal norm
has been excised, after all, became more easy to make the treaty shopping.

In the Europe Union (EU) we can see a legislative work about

prevention of praticts that leads to base erosion, tying to analyze the internal
market and densification a concept of artificiality.

Murilo Domene de Siqueira