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K. Perrou
Intertax
Volume 49, Issue 10 (2021) pp. 853 – 861
https://doi.org/10.54648/taxi2021083
Abstract
An increasing number of taxpayers rely on the EU Charter of Fundamental rights to challenge various aspects of tax procedures. However, not all cases are included in the scope of application of the Charter; an association with Union law is required. For VAT cases or for complaints relating to the direct application of provisions of EU directives, it is relatively easy to identify such association. This is not always as easy with cases involving direct taxation or those related to the application of purely national legislation that may, however, be a corollary to Union law provisions.
For cases that do not have a connecting element with Union law, protection may be granted under the European Convention on Human Rights (ECHR). Tax procedures, however, are only covered by the ECHR if they relate to a criminal charge, leaving a significant number of normal tax proceedings beyond the scope of fair trial guarantees.
The different scope of application and ambit of protection granted by the two instruments might lead to disparities in taxpayer protection. The entry into force of an advisory opinion mechanism before the European Court of Human Rights, similar to the preliminary reference procedure before the Court of Justice, may enhance taxpayer protection in the EU. The latter option, however, is to be used with caution: although referring a case that involves Union law to the ECHR is not expressly prohibited, it could arguably amount to a violation of Union law.
Keywords
Tax treaty, nonresident alien, federal tax exemption benefit, case law precedents.
Extract
This article focuses on the Base Erosion Profit Shifting (BEPS) Project and more specifically on the peer review of the four BEPS minimum standards. The first part of this contribution introduces the analysis of this process in the context of a case study of seven countries participating in the BEPS Inclusive Framework: Cameroon, Congo, Costa Rica, Jamaica, Peru, Sri Lanka, and Viet Nam. Thereafter, this article will provide the analysis of the peer review process by using the concept of throughput legitimacy developed by Schmidt (in other areas than tax law) that includes accountability, transparency, inclusiveness and openness. Its use can contribute to enhancing the governance of the peer review process and increasing legitimacy at the same time and thereby strengthening countries’ compliance with the four BEPS minimum standards. Its use can also facilitate helping countries that are part of the BEPS Inclusive Framework to build trust in the peer review process. In light of the findings of the case study, this article concludes that there are throughput legitimacy deficits and that these should be addressed by the OECD and countries participating in the BEPS Inclusive Framework. This article’s preliminary findings can be used for further research by the OECD, regional organizations, scholars, civil society, and think tanks to improve countries’ compliance with the four BEPS minimum standards.