Advantages:

1. Reduced Tax Burden: Tax treaties can help to avoid double taxation of income or capital
gains earned by residents of both the countries.
2. Attract Foreign Investment: By entering into tax treaties, Wonderland can reduce tax barriers
for foreign investors, which may encourage them to invest in the country.
3. Exchange of Information: Tax treaties provide for the exchange of information between
countries, which can help to prevent tax evasion and promote compliance with tax laws.
4. Improved Relations: Negotiating tax treaties can help to improve political and economic
relations between countries.

Disadvantages:

1. Loss of Sovereignty: By entering into tax treaties, Wonderland may be required to cede some
control over its tax system to other countries.
2. Compliance Costs: Tax treaties can be complex, and complying with their provisions may
require additional administrative resources.
3. Inequitable Outcomes: Tax treaties may benefit certain taxpayers over others, leading to
potential inequitable outcomes.
4. Reduction in Revenue: By reducing tax barriers for foreign investors, tax treaties may reduce
revenue that Wonderland could have otherwise collected from foreign investors.
1. Organisation for Economic Co-operation and Development (OECD): The OECD has a
significant role in the development of international tax policy, including the development of
the model tax treaty and the Base Erosion and Profit Shifting (BEPS) project.
2. United Nations (UN): The UN has also developed a model tax treaty and provides a forum for
discussing international tax policy issues.
3. G20: The G20 is a forum for the world's largest economies to discuss issues related to global
economic governance, including tax policy.
4. World Trade Organization (WTO): The WTO has a role in the regulation of trade-related
aspects of intellectual property rights and may become increasingly involved in international
tax policy.
5. International Monetary Fund (IMF): The IMF provides advice and technical assistance to
member countries on a range of economic issues, including tax policy.

If Wonderland adopted the exact terms of Article 2 of the OECD Model Tax Convention, only the
income tax and the capital gains tax in its Tax Code would be covered. Article 2 of the OECD Model
defines the taxes that are covered by the tax treaty and only mentions income taxes and taxes on
capital gains.

If Wonderland wishes to include the other taxes in its Tax Code, it will need to negotiate specific
provisions in the tax treaties with the other countries. It can propose additional clauses to the tax
treaty to include the other taxes, or negotiate separate tax agreements with the countries interested
in investing in Wonderland. However, including additional taxes in the tax treaties will depend on
the willingness of the other countries to negotiate such provisions. Some countries may be reluctant
to include taxes that are not covered under the OECD Model, and may require Wonderland to agree
to other concessions in exchange.

Other countries' reactions to a request to include all the taxes in Wonderland's Tax Code will depend
on the specific circumstances and negotiating positions of those countries. Some countries may be
willing to include additional taxes in the treaty to facilitate investment in Wonderland, while others
may be reluctant to do so. Generally, the inclusion of additional taxes in a tax treaty may increase
the complexity of the treaty and the administrative burden on taxpayers, which may be a concern
for some countries. Additionally, other countries may seek to negotiate reciprocal agreements that
include taxes not covered by the OECD Model in their own tax systems.

Question 3 How do countries confer rights on taxpayers under tax treaties? What approach do
courts in other countries take in interpreting tax treaties and to what extent do they use the
Commentaries on the Models in interpreting tax treaties? Is there any way through international
bodies in which Wonderland can publicly indicate its preferred position in negotiating tax treaties
and what would be the effect of such a public statement?
Tax treaties confer rights on taxpayers by providing a framework for the allocation of taxing rights
between countries. The treaty outlines which country has the right to tax specific types of income or
capital gains, and in what circumstances. These rights are conferred on taxpayers through the
treaty's provisions, and countries must respect these rights when applying their domestic tax laws.

Courts in other countries typically use various approaches to interpret tax treaties, depending on
the specific legal traditions and principles of the country. Some courts may take a strict literal
interpretation of the treaty's provisions, while others may adopt a more purposive or teleological
approach, seeking to understand the underlying intention of the treaty. In interpreting tax treaties,
courts may also refer to the Commentaries on the Models developed by the OECD or the UN. These
Commentaries provide additional guidance and explanations of the provisions in the Model Tax
Conventions and are widely used as a reference by tax authorities, taxpayers, and courts.

International bodies such as the OECD and the UN provide forums for countries to discuss and
negotiate international tax policy. Through these bodies, Wonderland can publicly indicate its
preferred position in negotiating tax treaties. Such a public statement may help to shape the
direction of international tax policy and influence the negotiating positions of other countries.
However, it is important to note that any public statement made by Wonderland may also be subject
to scrutiny and may be used by other countries in negotiating tax treaties with Wonderland.
Therefore, careful consideration and analysis of the potential consequences of such a statement are
necessary before making any public announcement.