Tax Cases Research Articles

Ochrona praw podatników w świetle orzecznictwa Europejskiego Trybunału Praw Człowieka w Strasburgu

One of the most effective systems of protection of human rights is the system defined in the European Convention of Human Rights. Until 2010, the European Court of Human Rights had rarely handled tax cases because, in principle, it excluded this category of cases from its jurisdiction in the field of the protection of taxpayer rights. Such cases had always been qualified – in accordance to the requirements of Article 6 of the European Convention on Human Rights – as criminal or civil (property-related) cases. A major change in the ECHR’s approach to cases featuring tax-related aspects occurred in 2011. Given the protection of the right to property as set out in Protocol No. 1, the ECHR ranted taxpayers protection related to the return of value added tax in situations in which the taxpayer fulfilled their record-keeping obligations. The adopted trend in the issued decisions is seen to be dominant, but to be considered grounded, a greater number of ECHR judicial decisions than at present is needed. There is no doubt that the new tendency in the judicial decisions issued by the ECHR may have a major impact on the decisions issued by administrative courts in Poland.

The Meaning of ‘Associate’: An Analysis of the Outcomes of Commissioner of Taxation v BHP Billiton (2019)

This article will discuss the judgment of the recent Australian tax case of Commissioner of Taxation v BHP Billiton Limited (‘BHP’). Specifically, it will discuss how the case affects the meaning of the word ‘associate’ and the phrase ‘sufficiently influenced.’ It will do this by recapping the original Administrative Appeals Tribunal (‘AAT’) case of MWYS v Commissioner of Taxation which formed the basis of the appeal in BHP. It will then discuss the majority and dissenting judgements in the BHP case and how they both interpreted the meaning of ‘associate’ and ‘sufficiently influenced,’ before reconciling the ideas from both judgments, and the original AAT judgement. This paper will then aim to highlight the precedential value of BHP and how BHP may affect other areas of Australian Taxation Law, namely the Controlled Foreign Corporation rules, Thin Capitalisation Rules, and the R&D grant rules.

Development of the electricity-environmental policy CGE model (GTAP-E-PowerS): A case of the carbon tax in South Africa

A new carbon price mechanism with full emission coverage is developed within the framework of a global computable general equilibrium model (GTAP-E-PowerS) to enhance the capacity and accuracy for climate change and energy policy assessment. The model developed is then used to examine the potential impacts of the carbon tax in South Africa. Results show that incorporation of non-CO2 emissions in the model significantly alters the results of which the economy of South Africa experiences higher costs compared to the case that only has CO2 emissions. When more sectors are included in the policy it also puts higher costs on the economy, as higher levels of emissions are subject to the carbon tax. Results also show that South Africa only experiences small tradeoffs from introducing the carbon tax in all scenarios. That is, with a tax rate of $9.15, the country is able to reduce its emission levels by 12.25%–15.6% at the costs of real GDP reduction by 1.17%–1.59%. Fossil-based industrial sectors are particularly worst off, while clean and renewable energy sectors strongly expand their production. The results indicate that South Africa is likely to move to a low carbon and sustainable economy with such a policy.

Features of the Application of the Decisions of the European Court of Human Rights by Ukrainian Courts in Tax Cases

Abstract The purpose of this article is to explore the subject of applying to the European Court of Human Rights in tax cases, the place of decisions of the European Court of Human Rights in the system of sources of tax law, the problems arising from the application of ECtHR decisions by Ukrainian courts in tax cases. The research was carried out using formal-dogmatic, system-structural, comparative-legal, historical and other methods of scientific cognition. The author concludes that it is important to use the decisions of the European Court of Human Rights to resolve public law disputes, the subject of which is public finances. After all, the Ukrainian tax system and tax legislation, the tax status of taxpayers and tax authorities should be based on the fundamental principles enshrined in the Convention and which have repeatedly been systematically interpreted in the decisions of the European Court of Human Rights.

Rise and Decline of the Westphalian Principle in Taxation: The Web Tax Case

The article analyses the crucial impact that the digital economy is having on international taxation and argues that the traditional taxing rules are inadequate to address the way that multinational enterprises are conducting business on the Internet and how value is created on the Web. The cornerstone of this analysis consists of the observation that, while the power of the states to tax is intrinsically connected to territory (thus, to a physical element), the Internet economy is not as it takes places in a virtual space (a Terra Incognita) which is, in legal terms, still uncharted. This situation is challenging the intimate connection between the power to tax and the territory state Sovereignty can be exercised on, superiorem non recognoscens. This is the Westphalian Principle, as commonly understood in History, and it is the pillar states have been built on since the mid-seventeenth century, in Europe. This article eventually considers the most recent development to overtake this empasse, in particular, the digital tax proposal as suggested by the European Commission in 2018. In this respect, it concludes that, while the European strategy is positive in terms of policy, in a purely legal perspective, it might initiate possible retaliation from qualified international stakeholders (including States such as the US) that would see their potential taxable base eroded by foreign unilateral measures and without any previous agreement in this sense. e-commerce, digital taxation, territoriality, income taxation, net neutrality, double taxation, tax competition, sovereignty, base erosion, BEPS.

Cooley v. Board of Wardens and its Nineteenth‐Century Legacy

<i>Cooley v. Board of Wardens</i> and its Nineteenth‐Century Legacy

The Effect of the Macroeconomic Environment on Judicial Behavior: The (Surprising) Case of Israeli Tax Litigation

Does the macroeconomic environment affect judicial decisions and thereby shape the law? Even though the normative significance of understanding judicial decision-making is undeniable, empirical research into how judges make decisions is woefully incomplete. This is the first Article to empirically examine the stabilizing fiscal potential of judicial decisions in tax disputes. In this Article, I use empirical methods to test whether macroeconomic conditions—namely, the business cycle—affect the outcomes of judicial decisions in tax cases. Theory prescribes either an anticyclical response to the business cycle or no response at all. I test this hypothesis with a novel dataset I constructed using judicial decisions made by specialized tax judges from the district courts of Israel before and after the 2008 financial crisis. The evidence suggests business cycles affect judges’ decisions in tax disputes. But counter to the theoretical prediction, judges favor the tax authorities during economic downturns and favor the taxpayers during economic upturns. This procyclical decision-making pattern may exacerbate economic instability.

Inter-governmental Fiscal Transfers in the Presence of Revenue Uncertainty: The Case of Goods and Services Tax (GST) in India

A comprehensive multistage Value Added Tax (VAT) system, namely Goods and Services Tax (GST), is introduced in India since 1 July 2017. GST encompasses various taxes from Union and State indirect tax bases, and it is a dual VAT system with concurrent taxation power to Union and State governments. It was envisaged that removal of cascading of taxes and enshrining destination based consumption tax system under GST will encourage investment and improve ease-of-doing business in India. Though it is not right time to comment on success or failure of Indian GST system unless the tax system stabilises, so far revenue mobilisation from GST is not encouraging. The shortfall in GST collection has been acknowledged in the ‘Medium Term Fiscal Policy cum Fiscal Policy Strategy Statement’ of the Union Budget 2019–2020. The genesis of revenue shortfall may be design and structural in nature and/or compliance and tax administration related. However, the uncertainty surrounding GST revenue collection is an issue which needs an in-depth assessment for fiscal management of Union and State governments. The impact of revenue uncertainty will not be restricted to Union finances alone; it will spill over to state finances through inter-governmental fiscal transfers. Therefore, depending on seriousness of the uncertainties associated with GST revenue collection, devising an inter-governmental fiscal transfer framework may be a challenging task for the Fifteenth Finance Commission. Given the information available in the public domain, this article attempts to explore possible causes of revenue shortfall and assess possible impacts of revenue shortfall on Union and State finances.

Сравнительная оценка подходов к расчету налогового потенциала регионов

Three basic methods are employed to assess the fiscal capacity of territories for fiscal equalization: the representative tax system method, the historical data method, and the macroeconomic indicator method. Each of these methods has its own advantages and disadvantages, while the historical data method is considered the most accurate in terms of approximation of the values of fiscal capacity to actual budget revenues. The aim of the article is to compare the accuracy of assessing Russian regions’ fiscal capacities through various methods, as well as by combining them, and to propose measures to change the current methodology for fiscal capacity assessment. The calculations presented in this article for the Russian regions for 2018 show that, in fact, the representative tax system and historical data methods have a comparable degree of accuracy, and the macroeconomic indicator method is only slightly inferior to them. At the same time, while assessing the fiscal capacity in regard to individual taxes, both the method of historical data and the method of representative tax system may have an advantage in the accuracy of the assessment, the method of macroeconomic indicators being inferior to them (except for the case of corporate income tax). As the author’s calculations show, it is possible to improve the accuracy of assessing regional fiscal capacity through the following measures: (1) not taking into account data for the current financial year, that is, taking into account data for only two reporting years; (2) not adjusting income tax and personal income tax fiscal capacity to the rate of tax revenue growth; (3) using the method of macroeconomic indicators for mineral extraction tax and other tax fiscal capacity.

Ruling as a form of settlement of an individual tax case: Considerations exemplified by tax overpayment

The ruling on the application of tax overpayment is a formal act which does not prejudge the existence of tax arrears, but which provides information on the way the payment is credited. The credit is legally binding. Therefore, the ruling on the credit only confirms that it has been effected. The amount of the tax liability or arrears shall not be verified in the credit decision. The amounts shall be fixed or determined in accordance with their respective procedures. The ruling is a formal condition for the overpaid tax to be credited against outstanding and current tax liabilities. The ruling has legal effects in the sense that as for the date of crediting the overpayment, tax arrears no longer exist.

An Introduction to the Standard Data Analytics Process for Accounting Students

The aim of this paper is to contribute to the effort to develop material for enabling the next generation of tech-savvy accountants with business analytic capabilities, and increase their exposure and familiarity with tools such as R. More specifically, we leverage the award-winning tax case of Borthick and Smeal (2017) to illustrate the teaching of the Cross Industry Standard Process for Data Mining (CRISP-DM) with R. Teaching the implementation of the data analytics process highlights the role and importance of each one of the stages (i.e., business understanding, data understanding, data preparation, modeling, evaluation, and communication). Implementing CRISP-DM in conjunction with R helps students gain a better understanding of data limitations (e.g., missing values, incomplete data, errors in data) and their implications in the context of the case, while providing a readily available record of all steps taken in a data analytics process (i.e., process documentation).

RETRACTED: The specifics of evidence in the tax process

The subject of the article is peculiarities of evidence in the tax process.The main purpose of the article is to identify the existence or absence of specifics of evidence in the tax process.The description of the problem field. Each stage of the tax process is accompanied by tax authorities issuing tax legal acts; it requires them to obtain the necessary evidence. At the same time, theorists of tax procedural relations seek to circumvent the issue of the nature of tax procedural evidence. Some researchers believe that the theory of evidence, which formed the interdisciplinary institute of evidence, can eliminate the need for a theoretical definition of the tax evidence, but this is difficult to agree with, since tax evidence has specific features that determines the need of its independent research.The description of methodology. The author uses analysis, synthesis, comparison, interpretation of legal acts, economic approach as well as the dialectic and formal-legal methods.The main results and scope of their application. Evidence in the tax process is information about facts that are relevant to the adoption of a certain decision by the authorized subject of the tax process. Evidence must be obtained from acceptable and reliable sources and investigated in compliance with the procedure established by law. It seems possible to set the list of evidence in the tax process legislation as follows: an oral explanation of the subject of the tax process or his representative; witness testimony; conclusion and testimony of an expert or specialist; written evidence, a protocol of a procedural action; material evidence; photo, video or audio materials. The evaluation of evidence by an authorized entity includes its consideration for relevance, admissibility, sufficiency and reliability. Only if the evidence meets the above criteria it will have probative value in a specific procedural situation.Conclusions. The purpose of the proof sets the maximum importance and its systemic significance for the entire tax process, since evidence-based knowledge traditionally appears to be the main supporting structure of the law enforcement process, in particular, evidence create the basis for its motives and conclusions. Accurate and objective establishment of factual circumstances of tax case is impossible without proper evidence. The main properties of evidence are relevance, admissibility, sufficiency and reliability.Keywords: evidence, tax process, tax procedural proof, tax authorities, means of proof, properties of evidence, individual tax legal acts, evidentiary information.

Optimal age‐dependent income taxation in a dynamic extensive model: The case for negative participation tax on young people

AbstractWe consider optimal age‐dependent income taxation in a dynamic model where the labor‐leisure choice is the extensive margin, each household faces idiosyncratic shocks to labor productivity and a pecuniary cost to work, and there is no insurance market against the shocks. We show that the well‐known property of the optimal participation tax rate in the static model continues to hold in our dynamic economy, that is, the participation tax rates for some income groups with low consumption are likely negative. In dynamic models, the optimal participation tax rate depends on age and on labor income. Our numerical simulations suggest that a negative participation tax should be restricted to young households.

French Tax Audits and Criminal Tax Cases

In this note, the author discusses the Law of 23 October 2018 Related to the Fight Against Fraud, which, inter alia, includes a measure to abolish the legal barrier between the French tax administration and the public prosecutor’s department.

Burden of Proof in Tax Cases: Valuation and Ranges - an Update

In this Article, the author discusses the difficulty in many valuation cases of determining a definite valuation point by the required degree of persuasion (more likely than not in most civil cases). This point was made cogently in Cede & Co. v. Technicolor, Inc., a frequently cited opinion by the Delaware Court of Chancery, a forum for significant litigation involving corporate valuations: [I]t is one of the conceits of our law that we purport to declare something as elusive as the fair value of an entity on a given date. . . . [V]aluation decisions are impossible to make with anything approaching complete confidence. Valuing an entity is a difficult intellectual exercise, especially when business and financial experts are able to organize data in support of wildly divergent valuations for the same entity. For a judge who is not an expert in corporate finance, one can do little more than try to detect gross distortions in the experts’ opinions. This effort should, therefore, not be understood, as a matter of intellectual honesty, as resulting in the fair value of a corporation on a given date. The value of a corporation is not a point on a line, but a range of reasonable values, and the judge’s task is to assign one particular value within this range as the most reasonable value in light of all the relevant evidence and based on considerations of fairness. Corporate valuations for estate tax are just one context of tax litigation, but there are many other contexts. A prominent example for some time now has been transfer pricing. Sometimes when ranges are identified, arbitrary conventions (such as the midpoint in trades as in the case of publicly-traded stock) can be used to determine the value in tax litigation. But when there is no such convention that should be applied, the burden of persuasion can resolve the valuation issue by identifying the range. The party bearing the burden of persuasion (or risk of non-persuasion) then has persuaded only as to the end of the range that does not favor that party; the value, based on persuasion, is determined accordingly. The party bearing the burden of persuasion in tax cases is usually the taxpayer. In this Article, the author discusses interesting features of the burden and how, at least before the Tax Court, the burden of persuasion might shift to the Service under the Supreme Court’s decision in Helvering v. Taylor, which the author urges is often misunderstood. Another benefit of identifying a range of values is that, if it is determined on appeal that the trier of fact misapplied the burden of persuasion but did identify the range, the court of appeals can resolve the case by picking the other end of the range (unless a successful attack is made on the trial court’s choice for the ends of the range).

Anti-politics and Global Climate Inaction: The Case of the Australian Carbon Tax

Action on climate change has enjoyed popular support in most Western countries. Despite this, successive governments have struggled to implement policy to tackle this issue. Using the case of opposition to the Clean Energy Act, passed in Australia to establish an emissions trading scheme, this paper argues that a growing and broad sentiment of distrust in political elites, described as ‘anti-politics’, can explain some of this contradiction. Particular forms of climate policy, in particular emissions trading schemes, have been successfully framed as policies that appeal to the interests of a new class of liberal elites while hurting ordinary working people. This frame was used successfully in Australia by conservative forces to oppose the Clean Energy Act. While used cynically by political leaders in this case, the paper argues that anti-political sentiment reflects genuine concerns about the detachment between the state and voting population. This detachment is reflected in neoliberal climate policies. Through briefly examining the cases of the Trump Administration’s withdrawal from the Paris Climate Agreement and the Gilets Jaunes protest movement, the paper argues that while formulating climate policy we must consider anti-political sentiment, developing responses to the climate crisis from a bottom-up rather than top-down approach.

정책옹호연합모형을 통한 정책변동 사례분석: 지역자원시설세 과세정책을 중심으로

본 연구는 정책옹호연합모형을 적용하여 화력발전에 대한 지역자원시설세 도입·변동 과정을 분석하였다. 분석결과는 다음과 같다. 첫째, 대부분의 외부요인들은 정책변동에 영향을 미치는 것으로 확인되었다. 둘째, 외부요인과 정책하위시스템 사이의 매개변수로서, 대통령의 통치이념이 더욱 적절한 변수로 나타났다. 셋째, 정부부처는 대통령의 통치이념이나 정부의 정책방향 등 상황변화와 입장에 따라서 정책옹호자, 정책조정자, 정책협상자, 정책결정자, 감독자 등 다양한 역할을 수행하였다. 넷째, 학습활동은 정책협의회 등을 통해 옹호연합 간 합의의 시도로 타협의 가능성 탐색과 대안 수정의 기회를 가졌지만 대부분 내부 지향적인 학습 수준에 머물렀다. 추후 조세정책 결정과정에서는 조세정책의 쟁점을 공개하여 세금을 부담할 국민들의 참여를 강화하고, 이를 바탕으로 한 사회적 합의를 통해 조세정책이 결정되는 원칙을 수립할 필요가 있다.

Measuring the Effect of Social Background on Judicial Decision-Making in Tax Cases

Judicial decision-making is an important part of the law-making process. The positive research of judicial decision-making is expanding, and its normative significance is undeniable. Even so, judicial decision-making in tax cases has not yet received much empirical attention. This study contributes to the existing literature, empirically evaluating if, and to what extent, non-legal factors affect the outcomes of tax cases. It examines the potential effects of judges’ social backgrounds and adds to the rather small but growing empirical literature on tax litigation. I coded the dependent variable—the judge’s level of acceptance of the taxpayer’s claim, meaning whether the judge sides with the taxpayer and overrules the IRS’s decisions—as an ordinal variable rather than the more common binary coding of the prevailing party. Binary coding can often be arbitrary, resulting in loss of information and misestimation. By allowing for an intermediate category of the prevailing party, in addition to the traditional binary options, the variable transforms to an ordinal measure of the judge’s acceptance level of the taxpayer’s claim. This study finds that in the Israeli setting, judges’ gender, seniority, age at the time of appointment, and age at the time of the decision affect judges’ decisions and subsequently the law.

The Journey to Fiscal Enlightenment

The title comes from a judgment I gave earlier this year.1 I was talking about the format of the statutes, which emerged from the Tax Law Rewrite project. A key feature of the inclusion of statutory ‘signposts’ which as I put it are there ‘to give clear pointers to each stage of the taxpayer’s journey to fiscal enlightenment’. I will come back to the Rewrite Project later in this speech. But it occurred to me that the phrase might have some relevance to my own career in the tax world, from Revenue Junior in the early 1980s to more recent experience as a judge at different levels of the hierarchy. Forgive me if in this lecture, rather than a structured discussion, I indulge in something of a journey down memory-lane, on my own rather halting progress to something like fiscal semi-enlightenment. I came to tax law relatively late. I did not study it at University or for my bar exams. My early practice was in very different fields, mainly planning, housing, and property law. It was something of a surprise therefore when, in 1979, I was invited to put my name forward for appointment as Revenue Junior on the Common Law side. In those days the Revenue Junior represented the Revenue in most of the cases relating to income and capital gains tax in the Chancery Division, usually on appeal from the General or Special Commissioners. Given the high marginal rates of income tax at the time, there was a steady flow of cases. There used to be a Revenue List, under which a judge was allocated to hear nothing but tax cases for up to four weeks. During that period, the Revenue Junior was fully occupied, but at other times it was possible to maintain my practice in other areas of the law.

DAMPAK PROGRAM AMNESTI PAJAK TERHADAPKEMAUANWAJIB PAJAK(WP) DALAM MEMBAYARPAJAKSESUAI DENGANUUNO. 11TAHUN2016

Taxation is still an interesting topic to discuss. A number of tax cases that have emerged lately have made people reluctant to pay taxes. This certainly has a negative impact on the government's efforts to increase state revenues through taxes. Law No. 11 was issued in 2016 concerning Tax Amnesty where taxpayers can report assets and debts that have not been reported at the Last Annual SPT and only pay ransoms in accordance with the law. The population in this study is the Individual Taxpayer who participates in the tax amnesty program in the work area of ​​the Semarang City Tax Service Office who participates in the 9,484 tax amnesty program, while the sample taken using the Slovin formula is obtained by 100 respondents. The method of analysis uses multiple linear regression. The results showed that the Random Audit Strategy had a significant effect on Taxpayer Compliance at the Primary Tax Office in the City of Semarang. Perceived probability of audit variable has a significant effect on Taxpayer Compliance at the Primary Tax Service Office in Semarang City, the Taxpayer Attitude variable has a significant effect on Taxpayer Compliance in the Primary Tax Service Office in Semarang City, and Taxpayer Compliance variable has a significant effect on Office Revenue Increase Primary Tax Service in Semarang City. The number of coefficient of determination in the first model shows the number of coefficient of determination (Adjusted R Square) of 0.467. While the number of coefficient of determination of the second model shows the number of coefficient of determination (Adjusted R Square) of 0.60.