Developing VAT Treaties: International Tax Cooperation in Times of Global Recovery

Zu, Y.

doi:10.1017/lst.2021.37

Developing VAT Treaties: International Tax Cooperation in Times of Global Recovery

Zu, Y.

Authors

Dr Yige Zu yige.zu@durham.ac.uk
Associate Professor

Abstract

The COVID-19 pandemic highlights the pressing need to address common challenges faced by all countries and, in particular, provide special support to developing countries through international cooperation. Taxation, in particular Value Added Tax (VAT), is a key area for strengthening international cooperation because of its critical role in financing the COVID-19 crisis and supporting global recovery. This article proposes the adoption of VAT treaties based on two considerations. First, there exist, in the interplay between states’ VAT laws, over-taxation and under-taxation that can be more effectively addressed by treaties than by unilateral state actions. Second, unlike income tax treaties, the VAT treaties would distribute more benefits from cooperation to developing countries than to developed countries, leading to normatively attractive distributional consequences. The proposed model offers a new approach to taxing cross-border transactions under VAT and could form part of the coordinated responses to a sustainable post-pandemic recovery.

Citation

Zu, Y. (2022). Developing VAT Treaties: International Tax Cooperation in Times of Global Recovery. Legal Studies, 42(1), 159-177. https://doi.org/10.1017/lst.2021.37

Journal Article Type	Article
Acceptance Date	Jun 5, 2021
Online Publication Date	Jul 2, 2021
Publication Date	2022-03
Deposit Date	Jun 30, 2021
Publicly Available Date	Jun 30, 2021
Journal	Legal Studies
Print ISSN	0261-3875
Electronic ISSN	1748-121X
Publisher	Cambridge University Press
Peer Reviewed	Peer Reviewed
Volume	42
Issue	1
Pages	159-177
DOI	https://doi.org/10.1017/lst.2021.37

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