Analysis of the International Tax Architecture and its Impact on Liechtenstein

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Type and Duration

FFF-Förderprojekt, November 2024 until January 2025

Coordinator

Business Management Taxation & Tax Law

Main Research

Wealth Management

Description

This project aims to analyse the current international tax architecture, focusing on its role in assessing the need for reform and proposing new international tax standards. The growing interest in addressing issues such as the (re)allocation of taxing rights, the taxation of the digital economy, substance as a means of conferring tax residency, and more, has proven to be a catalyst for rethinking the approach to governance in international tax matters. The study examines the governance challenges within this international tax framework and asks whether OECD-led institutions or the newly established United Nations Tax Framework Convention can bring greater fairness and inclusiveness to the decision-making process. A key concern in this regard is whether proposed international initiatives infringe on the sovereignty of countries to regulate their own tax jurisdictions, or whether these standards should be treated as non-binding soft law. Moreover, this project will also explore the representation of developing and low-income countries in the discussion of international tax architecture and argue for their greater involvement in the formulation of new proposals. In addition, the project addresses the challenges associated with the decisions of taxpayers (e.g. multinational entities) to relocate, highlighting the need for effec-tive implementation of base erosion and profit shifting (BEPS) measures and appropriate allocation of taxing rights to jurisdictions where value is created. Furthermore, the project analyses the impact of these international tax initiatives on Liechtenstein, how the country should respond and its potential role in influencing global tax policy decisions. By providing a comprehensive analysis of these issues, the project aims to highlight the increasing role of regional and national concerns for fairness and equity in decision-making processes that respect the interests of all countries, including small but economically significant jurisdictions such as Liechtenstein.

Principal Investigator

Prof. Dr. Martin Wenz

Project Collaborators

Niklas Kaiser

Kasem Zotkaj, MSc