– DAGTVA truth table –
DAGTVA® – Distribution of MNE profits
|No.||Problems exposed, requests, constraints and subjects||Origin||Pg||Li||Doc|
|40||Majority of tax disputes involving MNEs.||Pillar 1||8||33||RBMdf|
26. While Articles 7 and 9 are a common feature of substantially all tax treaties, there is greater variation in the terms of Article 7. But most importantly, a large proportion of tax disputes for large MNE groups are about the interpretation and practical application of those articles, and this is particularly true for marketing and distribution activities (RBMdf).
With transactional taxation described in DAGTVA, as I advocate, DAGTVA is not above the laws used in each State but before the law applied locally, at a stage of the transaction where the tax system is not yet defined in each State. At this stage of tax application, there can be no possibility of seeing disputes arising from the use of different tax systems. The rules of the game regarding the DAGTVA transfer pricing calculation are sufficiently clear and precise enough that the differences disappear. The reasons for these disputes are simple, they stem from the differences between the tax regimes used by States and this is where a global tax system is needed.
It is important to note that in this transactional taxation system with DAGTVA, it is not the MNEs that decide, but States which apply everywhere the same taxation process. The object of this study in the search for a World Single Taxation. Even a small majority of states is enough for its application to spread, knowing that United States has already legislated in this area, following the Supreme Court decision with judgment 17-494 South_Dakota / Wayfair Inc. ,involving a digital marketplace and the State in which it sells its products. I want to talk about the Wayfair Sale Tax which will soon be applied to nearly a quarter of the global economy and already to more than forty intra-US States. This law, by obligation on the part of other abroad States to respect its directives through the digital marketplaces they host, imply an effective and legally binding procedure for the rest of the World to apply this law and without their being able to really oppose it. (see the « Amount C » option in this page)
It is basically and implicitly the application of an international system of taxation that is seeking by OECD. The extra-US States will even have everything to gain from it, with a taxation of MNEs better distributed between them, as explained in the DAGTVA calculation of transfer prices.
This will force recalcitrant States to apply a correct taxation and fiscal transparency unless they find themselves « punished » as in this excerpt from the RBSpg page :
« As a result, an obvious imbalance in the commercial and fiscal consequences will therefore have to result in actions which will be detailed in the DAGTVA transfer pricing calculations because this imbalance can come from two sources, on the one hand the commercial aggressiveness of the company which will be largely constrained, on the other hand the actions of ‘non-cooperative’ states which will be ‘punished’ instantly! As has just been specified in this section, you will see that the room for maneuver of both parties will be greatly constrained, leading to a balance in international economic development by putting an end to the anarchy observed today. »
‘Uncooperative’ States which will be ‘punished’ instantly as explained in this article devoted to a new international regulation by taxation , regulation which will necessarily be the counterpart of decisions taken concerning the World Single Taxation system, implying in fact a World Single Market , not the topic of this study !