The research focuses on the directors, executives and employees that work for multinational entities.
The study also finds significant risks and uncertainties attached to the complex interaction of national rules, together with bilateral and multilateral treaties that do not always operate to eliminate additional taxes and charges. The tax and social security systems in individual countries are the product of long history, adaptation to worldwide developments and political, cultural and social considerations. While there is superficial similarity between each set of rules and practices, the detail varies significantly, creating obstacles to efficient compensation planning for IMEs and at times high costs of compliance.
The study draws on publicly available information including academic literature and data from the World Bank and Organisation for Economic Cooperation and Development (OECD). In addition, a survey of tax practitioners specialising in the area of taxation of IMEs was conducted with follow up interviews to elicit observations about the problematic issues in practice.
The assessment was made in terms of:
- Clarity and simplicity
- Administrative effectiveness
- Flexibility and realism
- International consequences and effects