IDEAS home Printed from
MyIDEAS: Log in (now much improved!) to save this article

International profits and interest payments : do the tax differentials still make any sense?

Listed author(s):
  • Gerold Krause-Junk

    (International Tax Institute, University of Hamburg)

Registered author(s):

    According to the Western Cominental European doctrine, international capital incomes are taxed differently according to whether they derive from equity or loans. Principally - though there are lots of practical deviations - interest payments are taxed according to the rules of the residence country, which is also the recipient of the tax yield, whereas profits are taxed according to the rules of the source country, which is also the beneficiary of the tax income. The basic rationale behind this differentiation is Slimmed up by the following two propositions, namely (1) The relevant tax system is to be determined by the location of the entrepreneurial activity. (2) Entrepreneurial activity typically is related fO ownership and is not related to t/ie extension of credit. The paper questions both of these propositions and comes to the conclusion that the tax differentials do not make sense any more.

    If you experience problems downloading a file, check if you have the proper application to view it first. In case of further problems read the IDEAS help page. Note that these files are not on the IDEAS site. Please be patient as the files may be large.

    File URL:
    Download Restriction: no

    Article provided by Finnish Economic Association in its journal Finnish Economic Papers.

    Volume (Year): 1 (1988)
    Issue (Month): 1 (Spring)
    Pages: 94-104

    in new window

    Handle: RePEc:fep:journl:v:1:y:1988:i:1:p:94-104
    Contact details of provider: Web page:

    More information through EDIRC

    No references listed on IDEAS
    You can help add them by filling out this form.

    This item is not listed on Wikipedia, on a reading list or among the top items on IDEAS.

    When requesting a correction, please mention this item's handle: RePEc:fep:journl:v:1:y:1988:i:1:p:94-104. See general information about how to correct material in RePEc.

    For technical questions regarding this item, or to correct its authors, title, abstract, bibliographic or download information, contact: (Editorial Secretary)

    If you have authored this item and are not yet registered with RePEc, we encourage you to do it here. This allows to link your profile to this item. It also allows you to accept potential citations to this item that we are uncertain about.

    If references are entirely missing, you can add them using this form.

    If the full references list an item that is present in RePEc, but the system did not link to it, you can help with this form.

    If you know of missing items citing this one, you can help us creating those links by adding the relevant references in the same way as above, for each refering item. If you are a registered author of this item, you may also want to check the "citations" tab in your profile, as there may be some citations waiting for confirmation.

    Please note that corrections may take a couple of weeks to filter through the various RePEc services.

    This information is provided to you by IDEAS at the Research Division of the Federal Reserve Bank of St. Louis using RePEc data.