Preferential Tax Regimes In Oecd Member And Non-member Countries

Several OECD member and non-member countries have by now established or are taking into consideration the establishment of preferential tax regimes to draw attention in highly mobile financial and other service activities. These regimes usually offer a location which is favorable for purpose of holding passive investments or for booking paper profits. In most cases the regime could have been planned particularly to act as an agent or some kind of channel for routing capital flows across borders. However, there are few key factors which may help in identifying the harmful preferential tax regimes, without targeting specific countries or jurisdictions.

The following questions have been addressed in this article:

What are the other factors other than the key factors that can assist in identifying harmful preferential tax regimes?
How do you assess the economic effects of a preferential tax regime in terms of its potential harmfulness?
What counteracting measures have been taken with countries that are engage in harmful tax competition?

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