Anti-hybrid mismatch provisions of the foreign tax legislations and their compliance with the tax certainty principle

Abstract

Hybrid mismatch arrangements are means of structuring cross–border transactions which result into double taxation or double non-taxation due to differences in the legal qualification of the taxpayer’s status or the legal qualification of the type of income. Hybrid mismatches arise due to imperfection of legislative techniques and are often accidental, but in some cases hybrid mismatch arrangements act as a way of committing tax offenses, leading to base erosion and profit shifting. The key provisions against the intentional use of hybrid mechanisms aimed at tax avoidance are being specified at the level of national legislations. One of the problems arising out of such norms’ adoption is concluded in providing them with compliance to tax certainty principle, which acts as a guarantee of tax legislation application in accordance with the content of public interest laid down into them, and as the means of protecting the taxpayers’ reasonable expectations at the stage of law enforcement. This article analyzes the existing anti-hybrid mismatch provisions of the certain foreign tax legislations (on the examples of the United States of America, of the United Kingdom and of the members of the European Union) for their compliance with the tax certainty principle.

References

1. Asoskov, A.V. (2018) Preclusive terms and their correlation with other types of civil law terms. Bulletin of civil law, 4, pp. 46–73 (in Russ.).
2. Vasiliev, A.Yu. (2010). Supreme Arbitration Court of the Russian Federation on the timing of in-house tax audits: a judicial precedent? Tax expert, 6, pp. 34–39 (in Russ.).
3. Vdovina, Yu.E. and Chernousova, K.S. (2020). Problems of tax control in the Russian Federation at the present stage of economic development. International Journal of Humanities and Natural Sciences, vol. 12–4 (51), pp. 89–91 (in Russ.).
4. Gadzhiev, T.F. (2021). International companies as a tool for deoffshorization of the Russian economy (financial and legal aspects). Legal Policy and Legal Life, 1, pp. 226–233 (in Russ.).
5. Gribanov, V.P. (2000) Implementation and protection of civil rights. Moscow (in Russ.).
6. Gurvich, M.A. (1961). Precautionary terms in Soviet civil law. Moscow (in Russ.).
7. Karaseva, M.V. (2021). Tax and civil law: modern forms and problems of interrelation. Vestnik VGU. Series: Law, 2(45), pp. 183–192 (in Russ.).
8. Kirillova, M.Ya. and Krasheninnikov, P.V. (2006). Terms in civil law. Limitation of actions. Moscow (in Russ.).
9. Litke, A.V. (2021). Problems of applying exemption or refusal to apply exemption from taxation of value added tax of transactions in accordance with the procedural requirements of Article 149 of the Tax Code of the Russian Federation. StudNet, 1, pp. 35–39 (in Russ.).
10. Malikov, A.F. (2019). The question of the correlation of the principle of equality of creditors (pari passu) with a preemptive period for inclusion in the register of creditors. Bulletin of Economic Justice of the Russian Federation, 1, pp. 17–25 (in Russ.).
11. Mardasova, M.E. (2016). Deadlines in the tax process. Moscow (in Russ.).
12. Orlova, N.A. (2021). On the application of interim measures in the framework of the execution of a decision made based on the results of consideration of tax audit materials. Legal Science, 7, pp. 42–47 (in Russ.).
13. Semenova, Ya.O. (2021). Limitation periods and methods of their calculation. International Journal of Humanities and Natural Sciences, Vol. 11–1(62). pp. 156–161 (in Russ.).
14. Serebrova, D.A. (2009). Consequences of non-observance by the tax authority of the deadlines for the forced collection of arrears. Lawyer, 12, pp. 31–32 (in Russ.).
15. Farshatov, I.A. (2004). Limitation of actions. Legislation: theory and practice. Moscow (in Russ.).
16. Fridman, N.P. (1986). Terms in civil law. Moscow (in Russ.).
17. Khusainova, A.V. (2018). On the issue of conducting a desk tax audit outside the period established by law. Interactive science, 7(29). pp. 67–69 (in Russ.).
18. Shapovalov, S.Yu. (2006). Terms in the new edition of the Tax Code of the Russian Federation. Ezh-Lawyer, 42 (in Russ.).
19. Shniger, D.O. and Dolgushin, A.E. (2021). Atropos for suretyship: a term of preemption in the correct interpretation. Law, 4, pp. 137–146 (in Russ.).
    
20. Ernst, W. (2009). The statute of limitations of the (D)CFR. In: O., Remien (Ed.). Statute of limitations in Europe — between preservation and reform (pp. 75–91). Tübingen (in Ger.).