Double Tax Treaties: An Introduction
Paper by: Reuven S. Avi-Yonah
The existing network of over 2,500 bilateral double tax treaties (DTTs) represents an important part of international law. The current DTTs are all based on two models, the OECDThe Organisation for Economic Co-operation and Development (OECD) is an international organisation comprising 38 member countries, established to foster economic growth, trade, and development on a global scale. Founded in 1961, the OECD provides a forum for governments to collaborate, share policy experiences, and develop solutions to common economic challenges. The OECD's core mission is to promote policies that improve... and UN model DTTs, which in turn are based on models developed by the League of Nations between 1927 and 1946. Despite some differences that will be discussed below, all DTTs are remarkably similar in the topics covered (even the order of articles is always the same) and in their language. About 75{780f53c297e2c008074d23b865a0ce0b35a4f08852d8e1e49466a5a902c4e44e} of the actual words of any given DTT are identical with the words of any other DTT. Thus, the DTT network is the most important element of the international tax regime, i.e., the generally applicable rules governing income taxation of cross-border transactionsIntra-Group Transactions are interactions between entities within the same multinational enterprise (MNE). Such transactions form the backbone of related-party dealings and are essential in managing global operations and aligning business objectives across jurisdictions. Understanding intra-group transactions is critical in international tax and transfer pricing, as they directly impact a company's tax obligations, profitability, and compliance standing. Tax professionals, accountants, lawyers,.... Indeed, I have argued that given the similarities among all DTTs, certain rules embodied in them (such as the requirement to prevent double taxationDouble Taxation occurs when the same income or financial transaction is taxed twice, typically in different jurisdictions. It can arise in two primary contexts: economic double taxation, where the same income is taxed twice in the hands of different taxpayers, and juridical double taxation, where the same taxpayer is taxed on the same income in more than one country. Double... by granting an exemption or a foreign tax credit) have become….
