International Tax Law Attorneys
THEVOZ Attorneys is an international tax law firm with offices in Austin, Texas and Geneva and Lausanne, Switzerland. Our international presence gives us a unique perspective about tax law that benefits clients in many ways, including:
- Providing extensive knowledge and experience in handling country-specific tax laws and regulations.
- Relying on our knowledge of foreign tax credits and international tax treaties to reduce tax liability on international business activities.
- Capitalizing on foreign tax laws for tax deferral opportunities.
- Defending tax reporting positions when compliance issues related to tax audits arise.
VAT can be confusing
We can also help American companies doing business in Europe with VAT issues. We do not have VAT in the US, so these taxes can catch those company unawares. Americans are often told the VAT is like a sales tax, but it is considerably more complex, in some cases, and also more expensive, ranging from 19 percent to 25 percent depending upon the country. Since EU countries apply the VAT by different rules, American companies do well to have a law partner that can help them navigate the different rules and all exemptions that may apply to their situation.
Transfer pricing is complex and requires expertise to navigate.
One of the most important issues in international business law right now is transfer pricing. When multinational enterprises (MNE) transfer goods or components within their group, they are required to charge the group as if it is an “arm’s length transaction,” or the same price they would pay if they were buying the goods from a third party. In practice, MNEs would use accounting gimmicks to make it appear as if the primary value-added activities to produce the good occurred in countries with the lowest tax rates, thereby lowering the tax liability for the MNE and depriving developed countries of tax revenue. This and other practices were so widespread, the Organization for Economic Cooperation and Development (OECD) created an initiative to combat what is called base erosion and profit shifting, or BEPS, to counter these corporate tax strategies that artificially lower tax revenue in high tax countries. Transfer pricing is at the heart of BEPS.
However, from the perspective of MNEs, the problem is not profit shifting but double taxation. The increased scrutiny of transfer prices within a group has threatened to shift power into the hands of tax authorities. Companies fear the information sharing requirements of the BEPS initiative will leave them vulnerable to charges of tax fraud for practices that were standard for many years – not least because fines and tax bills can be retroactive to activity that occurred years ago.
What can companies do to protect themselves? THEVOZ Attorneys will work with you to develop a Transfer Pricing Ruling that an MNE can use to defend themselves against an accusation of transfer pricing abuse and double taxation. We will determine which transfer pricing rules are most appropriate for the client’s portfolio of offerings, draft a Transfer Pricing Ruling and negotiate with the taxing authorities in the countries the MNE operates. Once agreed to, the Ruling is the basis for a defense against an accusation of transfer pricing abuse. We will also periodically review the Ruling to verify its terms still match business conditions like new technologies, supply chains, distribution, etc., and make adjustments as required. Transfer pricing never stops because business never stops.
Hiring an international tax law firm with a Swiss tax lawyer as a strategic partner for business growth is a good way to take maximum advantage of all the available global business opportunities available to your company.