Fairness in International Taxation: The Ability-to-Pay Case for Taxing Worldwide Income
29 Pages Posted: 17 Oct 2007
Abstract
Although the ability-to-pay fairness principle is a foundational element of American income tax policy, it has played a surprisingly small role in evaluating the U.S. international income tax regime. Perhaps this is because the application of the ability-to-pay concept to international income taxation is complicated by the presence of foreign taxpayers, by income earned through C corporations and by the claims of other governments to tax cross-border income. Nevertheless, it is possible, and indeed essential, to analyze international tax policy in terms of fairness. In this article, we extensively explore the international dimension of the ability-to-pay norm. We argue that this fairness criterion supports the conclusion that taxing worldwide income and ending the deferral privilege provides a tax regime that is superior to either the current U.S. international income tax system or the adoption of an exemption system.
Keywords: International Taxation, Taxation, International, Fairness, Equity
Suggested Citation: Suggested Citation
Do you have negative results from your research you’d like to share?
Recommended Papers
-
Competing for Capital: The Diffusion of Bilateral Investment Treaties, 1960-2000
By Zachary Elkins, Andrew T. Guzman, ...
-
Competing for Capital: The Diffusion of Bilateral Investment Treaties, 1960-2000
By Beth A. Simmons, Zachary Elkins, ...
-
Competing for Capital: The Diffusion of Bilateral Investment Treaties, 1960-2000
By Beth A. Simmons, Andrew T. Guzman, ...
-
Do Bilateral Investment Treaties Increase Foreign Direct Investment to Developing Countries?
By Eric Neumayer and Laura Spess
-
Do Double Taxation Treaties Increase Foreign Direct Investment to Developing Countries?
-
On Waves, Clusters, and Diffusion: A Conceptual Framework
By Beth A. Simmons and Zachary Elkins