Research On The Regulation Of Hybrid Entities Mismatch Arrangements

Hybrid mismatch arrangement is a radical and malicious tax planning activities.A taxpayer conducts planning arrangements for difference of tax treatment on the same entity or the instrument through the use of two or more different tax jurisdictions,in order to achieve the overall double non-taxation or long-term deferred tax purposes.Multinational companies avoid tax using tax loopholes or tax treatment differences in different tax jurisdictions,which is a product of 'global tax competition'.From the positive perspective,it is very conducive to the economic development in the invested region.From the bad side,it reflects the lag and imperfection of the current tax administration.For this reason,in October 2015,OECD launched the second action plan of the BEPS project,called as 'Neutralizing the influence of hybrid mismatch arrangements'(Hereinafter referred to as the 'the second action plans of BEPS project'),which puts forward suggestions to hybrid mismatch arrangements caused by the hybrid financial instruments and the hybrid entities payment and appeals for government to amend the national regulations and improve the tax agreement.The focus of this paper is that the proposed solution is whether and how to solve the problems caused by hybrid entities mismatch arrangement effectively,and the regulation method aimed to hybrid entities mismatch arrangement has whether or not referential significance to China.First of all,the first chapter of this paper will exhaustively introduce and illustrate the initiated background of the hybrid mismatch arrangements,content development and operation mechanism of hybrid entities mismatch arrangement.Aimed to proposed problems in the first chapter,the second chapter will analyze the specific content corresponding to the current regulation method,and use the comparative analysis method to compare specific regulation method of Britain and America.The third chapter focuses on the proposed regulation methods for the three hybrid entities mismatch arrangements in the second action plan of BEPS project and analyzes and evaluates them.It points out the shortcomings of the currently recommended method proposed by OECD.Finally,on the basis of the above research,the paper analyzes the relevant domestic laws and tax treaty rules.Based on the current situation of our country has not established the regulation to deal with hybrid entities mismatch arrangement,and combined with the actual situation of the China,the paper finally analyzes the necessity and possibility to regulate hybrid entities mismatch arrangement,and gives the author's introduction of anti mismatch rules.