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Tax Policy Blog

Stay informed with quick and accessible analysis of today's top tax policy topics. Read Tax Foundation's Tax Policy Blog for insight from our experts on tax policies across the U.S. and abroad.

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Blog Articles

6168 Results
Tax Cuts and Jobs Act offshoring Controlled Foreign Corporation rules around the world CFC rules US CFC rules passive foreign investment companies, PFICs GILTI, global minimum tax

How Controlled Foreign Corporation Rules Look Around the World: United States of America

The United States was the first country to enact CFC rules, and it is probably the country with the most complex set of rules that will be presented in this blog series. The rules determine control using a combined ownership test: one for the corporation and the other at the shareholder level. The assessable income under the rules is generally passive income but the amount of foreign income subject to U.S. tax has expanded with the adoption of GILTI.

10 min read
intellectual property IP tax GILTI FDII global minimum tax Biden tax patent boxes impact business, patent boxes, software, intellectual property tax

How Patent Boxes Impact Business Decisions

As with every change in tax policy, there are trade-offs. The Modified Nexus Approach adds an additional layer of complexity to the already complex issue of taxing IP income. Linking tax breaks for IP income to its associated R&D activity has changed the game and will likely result in some businesses restructuring and relocating their IP assets and R&D activity. Effective tax rates on IP income will likely play an important role in determining optimal locations, giving measures such as R&D credits more importance. Whether this new approach to IP taxation will impact profit shifting and which countries will be the winners and losers is yet to be seen.

6 min read
OECD global tax deal CFC Rules, OECD CFC, OECD multinational, OECD minimum tax, OECD multinational companies

CFC Rules Around the World

Our paper undertakes a review of controlled foreign corporation (CFC) rules around the world as a contribution to the global discussion over the possible expansion of existing anti-base erosion CFC regimes or the potential adoption of a minimum tax.

3 min read
controlled foreign corporation rules

Ripple Effects from Controlled Foreign Corporation Rules

Governments should recognize these trade-offs as they implement controlled foreign corporation (CFC) rules or change their tax policies in ways that increase taxes on foreign subsidiaries.

7 min read