Preventing Tax arbitrage via Hybrid Mismatches: BEPS Action 2 and Developing Countries

Kuzniacki, Blazej and Turina, Alessandro and Dubut, Thomas and Mazz, Addy and Quiñones, Natalia and Schoueri, Luís Eduardo and West, Craig and Pistone, Pasquale and Zimmer, Frederik (2017) Preventing Tax arbitrage via Hybrid Mismatches: BEPS Action 2 and Developing Countries. WU International Taxation Research Paper Series, 2017-03. WU Vienna University of Economics and Business, Universität Wien, Vienna.


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The Organization for Economic Cooperation and Development (OECD) under Base Erosion and Profit Shifting (BEPS) Action 2 indicated that tax arbitrage via hybrid mismatch arrangements "result in a substantial erosion of the taxable bases of the countries concerned" and "have an overall negative impact on competition, efficiency, transparency and fairness." The relevant action allowing for neutralising the effects of hybrid mismatch arrangements is therefore needed and justified. To achieve that purpose, the OECD developed different anti-hybrid rules under BEPS Action 2. In that regard, however, one may ask whether addressing tax arbitrage via hybrid mismatches as proposed by the OECD is of interest and relevance for developing countries. This paper aims to map that unexplored research area by means of a comparative analysis in four developing countries - Uruguay, Colombia, Brazil, and South Africa.

Item Type: Paper
Additional Information: Editors: Eva Eberhartinger, Michael Lang, Rupert Sausgruber and Martin Zagler (Vienna University of Economics and Business), and Erich Kirchler (University of Vienna)
Keywords: Hybrids, BEPS, Action Item 2, Mismatch, Developing Countries, Tax Arbitrage, Tax Governance, Sustainability
Classification Codes: JEL K33, K34, E62, E63, F62, H26, O23
Depositing User: ePub Administrator
Date Deposited: 29 Mar 2017 10:13
Last Modified: 01 Aug 2020 19:38


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