This paper considers the treatment of multinational business in the system known as an X Tax. The focus is on the choice between origin and destination treatments of transborder transactions. The destination-principle approach sidesteps the transferpricing problem. It remains in the origin-principle approach, which, however, presents fewer challenges of monitoring imports, obviates the tourism problem' whereby people can reduce their taxes by consuming in a low-tax jurisdiction and avoids transition effects associated with introduction of the tax and subsequent tax rate changes. The paper suggests special rules for transborder transactions between related parties to deal with the transfer-pricing problem.
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10676.
Length: Date of creation: Aug 2004 Date of revision: Handle: RePEc:nbr:nberwo:10676
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Paper
David F. Bradford, 2003.
"The X Tax in the World Economy,"
Working Papers
109, Princeton University, Department of Economics, Center for Economic Policy Studies..
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Find related papers by JEL classification: H20 - Public Economics - - Taxation, Subsidies, and Revenue - - - General H25 - Public Economics - - Taxation, Subsidies, and Revenue - - - Business Taxes and Subsidies
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References listed on IDEAS Please report citation or reference errors to , or , if you are the registered author of the cited work, log in to your RePEc Author Service profile, click on "citations" and make appropriate adjustments.:
Alan J. Auerbach & David F. Bradford, 2001.
"Generalized Cash Flow Taxation,"
Working Papers
131, Princeton University, Department of Economics, Center for Economic Policy Studies..
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Gordon, Roger H. & Hines, James Jr, 2002.
"International taxation,"
Handbook of Public Economics,
in: A. J. Auerbach & M. Feldstein (ed.), Handbook of Public Economics, edition 1, volume 4, chapter 28, pages 1935-1995
Elsevier.
[Downloadable!] (restricted)
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Roger H. Gordon & James R. Hines Jr., 2002.
"International Taxation,"
NBER Working Papers
8854, National Bureau of Economic Research, Inc.
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