Tax Law Research Articles

The Effect of Changes in Tax Laws on Stock Liquidity: Evidence From the Tax Cuts and Jobs Act

ABSTRACTThis paper investigates the effect of the Tax Cuts and Jobs Act of 2017 (TCJA) on stock liquidity. The TCJA brought significant changes, including a reduction in corporate tax rates and provisions incentivizing the repatriation of foreign earnings. We find a negative association between TCJA‐related events and the liquidity of U.S. stocks, persisting even up to 60 days following legislative announcements. However, despite the negative impact on liquidity, there is evidence of improved price efficiency following the TCJA enactment, driven by increased informed trading. Additionally, our analysis extends to non‐U.S. stocks traded in U.S. markets and indicates similar relations.

Understanding of Tax Directorate General Employees on Taxpayer Compliance Behavior

Revenue from the taxation sector is the main pillar of state revenue in the State Budget (APBN). However, the Tax ratio, tax capacity, tax effort and tax bouyancy are still very low in Indonesia, indicating that taxpayer compliance behavior in Indonesia is also still very low. Policy is a challenge in efforts to optimize state revenue, especially tax revenue to improve compliance. By understanding the factors that influence compliance behavior, policy makers can develop stronger and more effective ways of dealing with compliance risks. Based on the problems studied, the study uses a qualitative research type. The qualitative approach concentrates more on interpretation and understanding. In terms of data collection and analysis, this approach is sensitive to the context that aims to holistically understand the problems being studied. Qualitative research aims to obtain and understand the meaning of a context in its natural setting and does not prioritize generalization. The results of the analysis show that all informants agree and agree that taxpayers have non-compliant behavior in carrying out their tax obligations. Informants interpret that being compliant can only be obtained from the character of taxpayers, internal factors. Then followed by the influence of external factors in the form of economic factors and the environment of Taxpayers. According to informants, most taxpayers are not compliant due to ignorance, it is very important to ensure that the right tax information according to taxpayers' needs is conveyed clearly by the tax authorities. Supervision from the tax authorities and law enforcement efforts from the tax authorities can encourage taxpayers to behave compliantly. Taxpayers who are already compliant expect service and convenience. Meanwhile, taxpayers who decide not to comply require extra supervision according to tax regulations. Compliance or non-compliance with tax regulations is the result of ongoing interaction between the tax authorities and taxpayers.

Public International Law and Tax Law: A Fair and Equitable Nexus in International Taxation

This article, inspired by the authors’ participation in the research of the Tax Committee of the International Law Association, calls into question the appropriateness of the traditional definition of “tax nexus” and stresses the need to reconcile the existing rules with the principles of international law. It outlines possible avenues for establishing workable, fair and common criteria and rules for the definition of “tax nexus” that operate globally. The article focuses on the existing rules on international tax nexus, inter alia, residence and source, taking into account the principles of public international law, such as those related to tax sovereignty. It proposes the development of a new fair and equitable tax nexus to address the challenges of the globalized modern world, which can potentially draw from the practice in other areas of law, such as competition law. In such a global context, the goal is to verify whether and in which cases multiple criteria for nexus can be replaced with a single nexus based on the concept of the closest connection to a single jurisdiction.

The significance of tax risk for Polish companies based on the findings of an empirical study

Discussion of the problem of tax risk based on the empirical study. The paper explains the main aspects of tax risk, tax risk areas and its assessment. Critical analysis of existing literature and tax laws. Conclusions are formulated using a deductive method in the framework of tax theory and based on the analysis of tax laws and the author’s survey into the problem of tax risk conducted in the Wielkopolskie voivodeship in 2020. The survey results show that managers are increasingly aware of the tax risks associated with the activities of their companies and the industries in which they operate. They also indicate that, regardless of their size, companies should use tax risk management systems aligned with their tax strategies and managed by qualified staff. The article contributes to the analysis of tax risk.

The Quiet Evolution in International Tax: Domestic Law and Double Taxation

This article describes the respective roles of international tax law (predominantly tax treaties) and domestic tax law and their relationship with each other. This is a complex and interdependent relationship, with treaties, as special law, generally overriding domestic law. The article discusses the founding principle of tax treaties preventing double taxation, reflecting the original purpose of tax treaties. Subsequent developments over time have vigorously established the second principle of treaties: that the purpose of tax conventions is also to prevent tax avoidance and evasion. Such an increasingly important principle heralds the rise of anti-avoidance rules, prevention of abuse and the preservation of domestic taxing rights. The thesis in this article is that domestic law has prevailed against the more specialized law of treaties and at an increasing rate. This evolution has occurred in situations where the special law of treaties is “watered down” by the principle that treaties should not be allowed to be abused or in situations where they facilitate tax avoidance. What are the implications of this trend on the development of international tax policy? The article reflects on the respective roles of international and domestic law and guides us to suggestions on how to preserve important international tax principles in good faith and limit expedient domestic tax law changes when they are not driven by taxpayers’ abusive actions.

Double Taxation Conventions, Transfer Pricing and Fiscal Space. From Tax Law Underpinnings to Financial Assessments

Abstract This article tackles the sensible and complex problem of international taxation. The main objective of the paper is to create a comprehensive fiscal space, especially at the European level, in the direct taxation domain. The main scope of the research is to identify, evaluate, and assess the main pillars and features of this fiscal space. The research methodology is based both on theoretical analysis of double taxation and transfer pricing issues, but also on practical aspects of several specific case laws. The conclusions of the article highlight the further improvement and development of the arm’s length principle structure, improving double taxation multilateral conventions, recalibrating the mutual agreement procedure, and strengthening the tax authorities’ international cooperation techniques and tactics.

THE INFLUENCE OF TAXATION KNOWLEDGE, MOTIVATION, PERCEPTION, AND SELF EFFICACY ON ACCOUNTING STUDENTS' INTEREST IN A CAREER AS TAX CONSULTANTS

The goal of this research is to investigate how understanding of tax laws, drive, interpretation, and confidence impact the desire of accounting students at Universitas Mercu Buana Yogyakarta to pursue a profession as a tax advisor. This study utilizes a quantitative methodology through conducting a survey with 61 accounting students at Mercu Buana University Yogyakarta who have finished taxation courses. The study utilized purposive sampling to gather data via an online questionnaire. The collected information was analyzed using the multiple linear regression method facilitated by SPSS software. Findings revealed that a deep understanding of taxation greatly impacts students' desire to pursue a career as a tax advisor. The more students comprehend taxation concepts, the more likely they are to consider a profession in this field. However, the results also show that motivation, perception, and self-efficacy do not have a significant influence on interest in a career as a tax consultant. This indicates that even though students have high motivation or self-efficacy, these factors do not directly increase their interest in becoming tax consultants if their tax knowledge is inadequate.

Equity in Tax—All Change after 1873?

Until the late 19th century, equity and common law courts were separate. Tax courts emerged from equity, and today equitable principles and maxims govern the tax legislation, as well as His Majesty’s Revenue & Customs guidance and the tribunals. Even though the equity and common law courts “fused” in 1873, there has only ever been one law: common law tempered by equity. Only the courts, remedies and procedures were different prior to 1873 (though a unified Court of Exchequer with equity and common law jurisdiction existed before 1841). The law was already a single entity by the late 19th century. There was no fusion of actual laws in 1873, only of courts and procedure. Equity already moderated tax law, with beneficial ownership being all that mattered for tax purposes then and today. Keywords: equity; common law; fusion; tax; beneficial ownership; Supreme Court of Judicature Act 1873.

Is There Any Consensus about Market Jurisdiction among Pillar One Participating Jurisdictions? – Comparing Source Rules for Taxing Online Advertising Services

This article examines the limited consensus among Pillar One participating jurisdictions regarding market jurisdiction. It explores the reasons behind such limited consensus and its broader implications for international tax law.

How Have the Courts Decided What De Minimis is in Tax Law?

This article analyses how South African courts have decided the applicability of the de minimis non curat lex maxim and, more broadly, considered the de minimis concept in tax law. A doctrinal research methodology is employed with the focus on an analysis of predominantly reported judicial decisions. The applicability of the maxim is found to be decisive in only one tax case: the Diageo SA (Pty) Ltd v Commissioner for the South African Revenue Service case of 5 July 2023. Consequently, this study thus also reviews judicial precedent in respect of the applicability of the maxim in other areas of the law with consideration of the relevance to tax law. Further, several tax cases that refer to the broader de minimis concept or to trivial or trifling matters are examined. As there is no one definitive test to determine the applicability of the maxim, the courts have used several factors to guide their determination. Through inductive reasoning, the following conclusions are drawn. (i) In respect of statutory interpretation: First, the primary factor in the determination of the applicability of the maxim is the purpose of the provision. This is aptly demonstrated in the Diageo judgment. Secondly, where the statute sets a clear, objectively verifiable limit or amount, there is essentially no room for the application of the maxim in interpreting the statute. Where, however, no such verifiable basis is provided, a purposive interpretation is paramount – which may in fact require the application of the maxim. (ii) The use of the de minimis concept in tax law appears to depend on whether the matter is one of principle (substance) or practicality (administrability). In the former case, the amount (the factor of extent or value) is irrelevant whereas in the latter, the de minimis concept has been applied.

ACHIEVING THE LEGAL OBJECTIVE OF WITHHOLDING INCOME TAX ON FOREIGN YOUTUBE VIDEO CREATORS FOR VIDEO UTILIZATION INCOME SOURCED IN INDONESIA

<p>One of the digital economy transactions is the transaction on YouTube monetization received by video creators based on viewers in a source country. Overseas video creators do not pay Income Tax (PPh) in Indonesia on income from Youtube videos sourced in Indonesia because there is no physical presence of the video creator in Indonesia and no identified income as a tax object on which the Indonesian tax authorities impose PPh on the overseas video creator. This condition creates legal uncertainty, injustice, and loss of benefit for Indonesia as a source country due to the loss of potential PPh revenue from the digital market. Currently, Article 32A of the General Provisions and Tax Procedures (KUP) Law has provided a formal tax law to be able to appoint other parties as PPh withholders. However, the implementation is not yet possible because the material tax law is not yet sufficient to designate other parties, such as Google, which are not domiciled and have no permanent establishment in Indonesia as PPh withholders. To achieve legal objectives, the PPh Law as material tax law needs to be strengthened to provide legal certainty in the PPh withholding on foreign video creators and create justice and benefits for Indonesia as one of the source countries for video creators' income. Strengthening the PPh Law is conducted by amending the provisions of Article 26, Article 2 paragraph (4), and Article 4. The amendment to the PPh Law does not result in revisions of the P3B Indonesia and other countries since the allocation of taxation rights for royalty income from the source country has been regulated in the P3B. Furthermore, the government could make implementing regulations regarding the PPh withholding by other parties on income from the utilization of content copyrights received by YouTube video creators.</p>

Tax illegality in the context of criminal and penal fiscalliability

Illegality is one of the conditions for a crime. This condition is the most important level of connections betweencriminal law and other branches of law. These relationships are weaker in terms of mala in se, which violates thebasic principles of interpersonal relations, while they are stronger in terms of mala prohibita, which violates detailednormative regulations. As a rule, this group includes tax crime, regardless of whether fiscal penal law orcommon criminal law is applied (the latter concerns VAT fraud and invoice forgery). In both cases, the basis forcriminal liability is a violation of tax law regulations (tax illegality). As a rule, tax law eludes the intuitive understandingof illegality (denial of legality). The main part of tax law provisions regarding the construction of taxesand the assessment of tax liability does not contain typical prohibitions or orders, but regulates the effects ofprivate law transactions, and the source of tax illegality will be the difference in views on the interpretation of theprovision between the taxpayer and the tax authority or administrative court. To the extent that the tax authoritydoes not issue a decision determining the tax liability (tax arrears), there is a presumption of the correctness ofthe tax declaration, which calls into question the authority of the criminal court to adjudicate a tax offense (to theextent that the statutory features of a prohibited act include incorrect declaration of tax).

Modern tax law as an important creative factor of socialrelations

The article presents modern tax law regulations as a factor influencing social relations and behavior. The authorfocused on presenting the subject on the example of sugar tax, recycling fee and excise tax. The article presentsthe motivations and activities of the legislator compared with their real impact on collective behavior in the state.

Kemanfaatan, keadilan, dan kepastian hukum restorative justice pada ketentuan perpajakan

Restorative justice has been implemented in tax provisions, namely the KUP Law and the PPSP Law which regulate tax collection, audits and investigations. Restorative justice is further reaffirmed in the Law on Harmonization of Tax Regulations (UU HPP), which is known to be contained in the explanation of Article 40B clause (3), Article Article 44B clause 2a and Article 64 clause (2). It is estimated that tax law enforcement with a restorative justice approach can be a more comprehensive and sustainable solution in dealing with violations. Dispute resolution is focused on efforts to reconcile the parties, in this case between countries positioned as victims and parties who commit violations. This is done with the aim of creating a better climate of compliance and reducing protracted problems. This journal article was prepared in order to analyze the value of benefit, justice and legal certainty regarding the implementation of the article on restorative justice regulated in the UU HPP for violations that have the potential to harm the country's economy. By using non-doctrinal legal research methods based on theory and application to regulations, it is hoped that the results of theoretical analysis related to the principles of restorative justice can provide further insight into how the values of benefit, justice and legal certainty are applied as law enforcement, especially in the field of taxation.

TAX LAW AND STATE INTERVENTION IN THE ECONOMY: WAR IN UKRAINE AND CHANGE IN TAX LEGISLATION TO MAINTAIN STABILITY IN BRAZIL

The scenario of instability and hyperinflation caused by the COVID-19 pandemic and the War in Ukraine has led Brazil to a serious crisis, with widespread price increases and deregulation of economic stability. Therefore, given the increase in fuel prices, which has a systemic effect throughout the country, it became necessary to implement a model of State intervention in the economic domain in order to minimize the impacts resulting from the unfavorable situation. Given the possible solutions, Tax Law proved to be the best solution for the case, being a mechanism for distributing the burdens of the situation among different entities of the Federative Republic of Brazil. It is therefore necessary to demonstrate how Tax Law is integrated into a form of State intervention in the Economy, correlated to classic State functions, in addition to the viability of intervention through tax legislation in order to reestablish a peaceful scenario and national economic stability.

The implementation of tax imposition Micro Small Medium Enterprise (MSME) in the form of limited companies after the expiry period of final income tax

The MSME tax policy has undergone several changes and changed regulations. In 2022, the government again re-regulated MSME taxes, namely PP Number 55 year 2022 regarding Adjustments to Regulations on Income Tax. This research uses a descriptive qualitative approach. With the issuance of PP Number 55 of 2022, this provides an opportunity to increase the taxes owed by MSMEs and researchers also want to illustrate to the government that after this regulation is issued what impact will be felt by MSME Taxpayers, so that this will later be used as an evaluation by the Government. The result of this research is the calculation for the 2023 tax year using the rate of Article 17 of the Income Tax Law with the rate of 22%, and an additional 50% tax reduction as the Income Tax Law Art 31 E, resulting in the tax payable of IDR 4,240,946.16. PT ABC must carry out the bookkeeping obligations in reporting the tax liabilities and create proof of transactions for every business transaction to avoid a high tax burden.

COMPLIANCE TRIBUTÁRIO INTERNACIONAL: DESAFIOS E ESTRATÉGIAS NA GESTÃO DO IVA E O USO DE PARAÍSOS FISCAIS

The complexity of the global fiscal landscape, marked by the variety of laws, regulations, and management and corporate strategies of multinational corporations. This article investigates international tax compliance, focusing on its relationship with Value Added Tax (VAT), tax havens, and tax law. The objective is to assess how compliance with tax obligations in multiple jurisdictions impacts multinational companies, particularly with regard to VAT, whose complexity requires rigorous management to avoid penalties. Using a qualitative approach, the study analyzes legislation, international treaties, and business practices, highlighting the challenges of harmonizing tax efficiency with legal compliance. The results indicate that the use of tax havens, although offering tax benefits, exposes companies to high risks due to increasing global regulatory scrutiny. Corporations must act cautiously when designing their global activities, ensuring that their tax planning strategies are not seen as abusive, illegal, or evasive, to avoid future problems. It is concluded that an effective tax compliance strategy, aligned with international tax law, is essential to mitigate risks and ensure business competitiveness in a dynamic and strictly regulated global environment.

Development of an Information System for eTax Return Reporting PPh 21 Employees at PT. FBR Mitra Sejati

This research aims to develop an information system that supports collecting Income Tax (PPh) for employees in a tax consulting company. This research analyzes the suitability of the tax collection procedures applied by the company and the applicable tax provisions. The method used in this research is descriptive analysis based on data obtained through interviews, observations, and literature review. The results show that the principle of income tax collection in tax consulting companies is in line with the general tax withholding method, with estimated net income as the basis for calculation. The tax rate variations applied include the provisions in Article 17 of the Income Tax Law and related government regulations. The information system developed aims to improve efficiency and accuracy in the reporting of Income Tax Return 21 and support better tax compliance.

Potential Tax Discrimination against Italian-Sourced Dividends and Capital Gains Received by Foreign Investment Funds Not Compliant with EU Regulatory Framework

This article delves into the complexities of cross-border taxation of Italian-sourced dividends and capital gains paid to Italian and foreign investment funds. More specifically, the authors scrutinize whether Italy’s current domestic tax laws violate the EU fundamental freedoms, particularly regarding foreign funds that, despite not being subject to the UCITS or AIFM Directives, are subject to a regulatory framework similar to that imposed on Italian funds.

Capitalizing on sport labor migration: The role of ethnic capitalism in the discriminatory, regulatory, and exploitative environment for international college athletes in the United States

International college athletes (ICAs) are integral to the National Collegiate Athletic Association (NCAA) and lie at a particular social location as they are international students and college sport laborers. However, little research examines the discriminatory regulations toward ICAs by the NCAA, its member institutions, and the US federal government. Recent court rulings that permit college athletes to monetize their name, image, and likeness (NIL) do not benefit ICAs because of outdated and exclusionary restrictions imposed by federal immigration policies, visa laws, and US tax laws, which prohibit ICAs from having equitable rights, building their personal brand and professional careers. To examine the discrimination, regulation, and exploitation of ICAs by the US federal government and the NCAA, we apply the theory of ethnic capitalism, which highlights the marginalization of groups based on their ethnicity and national origin. In this setting, ICAs are treated as bodies of athletic labor, recruited for institutional gain and athletic program reputation to benefit US higher education institutions (HEIs). To conclude, we propose the need for the NCAA and its member institutions to treat ICAs equitably and include, support, and advocate for them, specifically regarding their inclusion in NIL on US lands.