: Some countries use a territorial system , exempting certain foreign-source income from domestic tax entirely. Transfer Pricing :
: Designed to prevent taxpayers from deferring tax on mobile income by shifting it to foreign "controlled" corporations. INTERNATIONAL TAXATION
: Allow taxpayers to reduce their domestic tax liability by the amount of taxes paid to a foreign government. : Some countries use a territorial system ,
OECD Model Tax Convention : Favors capital-exporting (developed) countries. INTERNATIONAL TAXATION
: Requires transactions between related entities (e.g., a parent company and its foreign subsidiary) to be priced as if they were between independent parties to prevent profit shifting. Key Instruments & Models
: An OECD-led initiative to close gaps in international tax rules that allow multinational enterprises to artificially shift profits to low or no-tax locations. International business | Internal Revenue Service
: Countries tax income generated within their borders , regardless of the taxpayer's residence. Mitigating Double Taxation :