Study On The Application Of Principal Purpose Test Rules In International Tax

China has selected the principal purpose test as a substantive technical rule program to prevent the abuse of the tax agreement,and has a long history in the application of the principal purpose test,but no further implementation details have been issued.And in addition,the principal purpose test gives law enforcement agencies a lot of discretionary power,the application of the principal purpose test in China needs to be solved urgently.The BEPS multilateral convention is only the first step in international tax reform.Given that China has signed a large number of bilateral tax treaties,it still needs adequate preparation in terms of legislation,law enforcement.Australia regards the principal purpose test as the pillar of the general anti-avoidance rules.It has always insisted on using and continuously developing and improving the principal purpose test rules,and has established a relatively complete set of anti-avoidance rules based on the principal purpose test rules.Therefore,Australia is an ideal comparative research object.By comparing the improvement process of the principal purpose test clause in the tax treaty between China and Australia,and the manifestation of the principal purpose test in the general anti-avoidance rules in China and Australia,we can find that in China,there are deficiencies such as inconsistent regulations,unclear standards and weak operability in the application of the principal purpose test.In response to these shortcomings,the relevant suggestions are made with reference to the Australian relevant experience.