Year: 2025
Type: article
Abstract: Double taxation-where the same income is taxed by two jurisdictions-raises the cost of cross-border trade, distorts investment decisions, and threatens the neutrality and fairness of the international tax system.Bilateral and multilateral tax treaties have emerged as the principal legal instruments to allocate taxing rights, remove juridical and economic double taxation, and provide cooperative procedures for dispute resolution.This paper presents a doctrinal and conceptual analysis of how tax treaties work to prevent double taxation without relying on any primary or secondary empirical data.It examines the structure of modern treaties, the allocation rules for business profits and passive income, the mechanisms of relief (exemption, credit, and deduction), and the administrative frameworks-Mutual Agreement Procedure (MAP) and arbitration-that operationalize relief.The paper also explores contemporary pressures on treaty policy, including hybrid entities, treaty shopping, anti-abuse standards (PPT and LOB), the Multilateral Instrument (MLI), and the digitalization of the economy.It identifies a research gap around the normative coherence of overlapping antiavoidance standards and the practical sufficiency of dispute-resolution capacity.The study concludes with findings and recommendations aimed at improving certainty, reducing compliance costs, and safeguarding both revenue and investment neutrality.
Language: English
Topic: Taxation and Legal Issues
Subfield: Accounting
Domain: Social Sciences
Open Access status: hybrid
OpenAlex ID: W4413295010