Bulletin n. 2-3/2012
October 2012-February 2013
CONTENTS
  • Section A) The theory and practise of the federal states and multi-level systems of government
  • Section B) Global governance and international organizations
  • Section C) Regional integration processes
  • Section D) Federalism as a political idea
    • Martin Ruf, Alfons J. Weichenrieder
    The taxation of passive foreign investment: lessons from German experience
    in Canadian Journal of Economics/Revue Canadienne d'Economique , volume 45 n.4 ,  2012 ,  1504-28
    The paper evaluates the working of German CFC rules that restrict the use of foreign subsidiaries located in low-tax countries to shelter passive investment income from home taxation. While passive investments make up a significant fraction of German outbound FDI, we find that German CFC rules are quite effective in restricting investments in low-tax jurisdictions. We find evidence that the German 2001 tax reform, which unilaterally introduced exemption of passive income in medium- and high-tax countries, has led to some shifting of passive assets into countries for which the exemption was previously limited.
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