Foreign Investment Fund Regimes: An Overview of Policies, Structures, and Issues
TAXING OFFSHORE INVESTMENT INCOME: A COMPARATIVE REVIEW OF STRUCTURAL, pp. 1-19, John Prebble, ed., Fiscal Publications, 2006
19 Pages Posted: 14 May 2010 Last revised: 10 Apr 2015
Date Written: 2006
Abstract
The expression “foreign” or “overseas investment fund regime” can be misleading. The direct targets of such a regime are local residents of the country that enacts the regime. Overseas investment fund regimes aim only indirectly at investment funds in other countries. The objective of a foreign investment fund regime is to tax local residents in their share of income derived by funds in which the have invested. They try to prevent income escaping tax altogether through diversion to foreign jurisdictions. Secondly, they try to frustrate deferral by taxing income to the economic beneficiary as it accrues, though the income may not be distributed to the taxpayer for some years.
Keywords: Foreign investment fund regimes, anti-avoidance, capital export neutrality, Jurisdiction
JEL Classification: K33, K34
Suggested Citation: Suggested Citation