International tax and business planning opportunities through commissionaire arrangements

Article Abstract:

Commissionaire distribution arrangements are used increasingly by US multinationals as a tax-efficient means of distributing goods in Europe and elsewhere. Local distribution companies sell goods in their own names while foreign suppliers act as undisclosed principals in these structures. The arrangements permit easier compliance with US transfer pricing rules, better use of foreign tax credits, and direct tax recognition of foreign trade losses. Accounting and transfer pricing considerations, objectives, operational structure, and related issues are discussed.

Distribution of goods, Distribution (Commerce)

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Tax planning strategies for multinationals under the new transfer pricing regulations

Article Abstract:

US multinational companies must plan to deal with potential tax liability under the final transfer pricing regulations. The taxpayer's best method must be chosen from several available including the comparable uncontrolled price, market strategy rules, comparable profits, and profit-split methods. The regulations address special intellectual property issues, establish an arms-length range, and increase both flexibility and risk. IRS audits could lead to assessment of both taxes and heavy penalties, so international tax planning should be a top priority.

Planning, Transfer pricing

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Unitary apportioning: a key to global tax harmony

Article Abstract:

California's unitary apportionment tax scheme could serve as a model for harmonizing global taxation of multinationals. Unitary apportioning would increase accuracy and reduce arbitrariness since this method accounts for multinationals' behavior more effectively than separate accounting. Separate accounting receives political support due to fears of double taxation. However, worldwide unitary apportionment would be more beneficial to both taxpayers and taxing authorities, despite the increased administrative burdens.

Models, Analysis, California, Tax assessment, Harmonization of laws, Unitary taxation

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