Anti-avoidance rules in Russian and German tax law: the comparison of collision resolution practices

Abstract

Dozens of research papers over the last years testify that the problem of tax avoidance has grown to such a global extend that no country is able to cope with it alone. To do this, a principally different, a new approach is required. These circumstances and the political will of the G20’ leaders towards solving the problem of tax avoidance determined the start of the project for counteracting the tax base erosion in the form of a scheme of 15 recommended action items of various orientations (so-called plan BEPS). Implementation of this plan envisaged by Main Directions of Taxation Policy for 2016 and Planned Period of 2017 and 2018, to be applied to Russia, assumes implementation of the elaborated proposals in the national legislation. The unavoidable resulting complicacy added to a variety of instrumentarium of counteracting tax avoidance will significantly increase the risks of competition between counteracting institutions in law enforcement practice. More than that, courts are already facing the problem of institutions’ collisions in solving cases. Allowing for the fact that the outcome of the whole case depends on selecting the proper application of the institution, so solving the problem of their correlation has both a theoretical and a rather important applied significance. In order to search for optimal approaches to solving the existing or assumed collisions of anti-avoidance norms, the article carries out a comparative analysis of provisions of the Russian and German taxation laws. The hypothesis of the research is that competition of the norms or taxation law institutions is made possible in terms of comparability of substantiation of their application, execution a similar function by them, yet with evident difference of application results for taxpayers. In terms of this hypothesis, the article identifies five main function of anti-avoidance norms: identifying a fact of inappropriate calculation and (or) tax payment; qualifying transactions of the taxpayer’s activity and determining their consequences for the tax purposes; providing recovery of the tax amount from the taxpayer; punishing for tax avoidance; preventing tax avoidance. Classification of the institutions carried on their basis allows to identify potential collisions between them. In terms of description of substantiations and application practice by competing institutions (both in Russia and Germany), the article gives a description of the approaches applied, in the author’s opinion, for solving their collisions in Russia.