Admission requirements
Prospective students are recommended to have completed a minimum of one year of university education (not necessarily in law or economics). Proficiency in English, both verbal and written, is expected.
Description
Context
In the past, tax planning and tax compliance was often left to tax experts. Nowadays, empirical research and interviews with CEOs and CFOs indicate that corporate income tax (CIT) is ranked high as an important business factor. This is becaus CIT is a significant cost to business which affects business’ locations and investments. The effective corporate income tax burden of a multinational firm therefore has a potential impact on its profitability and stock price.
From a business perspective, however, dealing with CIT is becoming increasingly challenging for several reasons. First, more complex tax rules can be observed all over the world since countries started tackling tax avoidance by multinational firms. Second, international firms are confronted with increasing tax uncertainty, which hampers investment decisions. Third, multinational firms are also confronted with pressure from society and politicians to pay their fair share of taxes. Media attention on tax avoidance schemes has been the main trigger of this pressure. In the light of these challenges, the tax position is a strategic issue that requires the attention of the board of directors of a multinational firm. Meanwhile, countries’ governments are challenged by a political dilemma: how they can ensure to collect enough tax revenues to provide good welfare, while keeping their country competitive and attractive to foreign investments.
Design of the course
In this context, the course Tax in the Boardroom illustrates the challenges that multinational firms and countries must face, the political compromises that are agreed to overcome such challenges, and the resulting regulatory outcomes. The course explains tax avoidance strategies (such as transfer pricing schemes, the use of tax havens, and tax secrecy) and the regulatory solutions that have been applied to tackle them (OECD transfer pricing standards, exchange of tax information, the EU list of tax havens, Pillar 2 rules for minimum taxation). The course also highlights the political negotiations behind the regulatory solutions, and the extent to which such solutions are successful.
Place within the minor ‘Tax and Society’
The minor ‘Tax and Society’ focusses on how national and international tax policy can help build fair and prosperous societies in the face of major societal challenges. This course introduces students to the strategic corporate income tax issues at boardroom level of a multinational firms, as well as at government level of small and big countries.
Course objectives
Upon successful completion of the course, students can analyse the challenges in the field of international corporate taxation for a multinational firm and can evaluate the public debate about it.
At the end of this course, students will be able to:
can indicate the state of play of the international corporate income tax framework and its connecting factors;
understand of the arm’s length principle, the transfer pricing methods and its consequences for transfer pricing strategies used by multinational companies;
can indicate the level of aggressiveness of the most common international tax planning structures and can develop views on the consequences of these structures for corporate responsibility purposes (CSR), including reputational issues;
can apply the main rules of international (OECD) and supranational (EU) rules on exchange of information on tax rulings (tax agreements) agreed between multinationals and governments;
can apply the main rules of the Country-by-Country Reporting (CbCR) obligations;
can monitor developments towards Public Country-by-Country Reporting (PCbCR), including the voluntary disclosure of the corporate income tax paid per country (Shell case);
understand the phenomenon of tax haven countries and can understand the main rules and effectiveness of the international (OECD) and supranational (EU) policy responses to address the issue of tax havens;
understand the main rules, pros and cons, and effectiveness of the OECD BEPS Pillar 1 (market state taxation for largest MNEs) and Pillar 2 (global minimum tax for large MNEs) proposals;
train case-analysis and written communication skills on the main issues of international corporate taxation by means of tutorials.
Timetable
See MyTimetable.
Mode of instruction
Lectures
Number of (2 hour) lectures: 6
Names of lecturers: dr. M.F. Nouwen
Required preparation by students: Not applicable
Seminars
Number of (2 hour) seminars: 6
Names of instructors: dr. M.F. Nouwen and F. Casano LLM
Required preparation by students: Case studies
Other methods of instruction
Description: Tax debate with representatives from business and government about transfer pricing, tax transparency, international tax avoidance, global tax deal, etc.
Number of (2 hour) instructions: 1
Names of instructors: guest lectures/ representatives from business. In previous academic years, guest participants in the tax debate included, among others:
Joost Kutsch Lojenga (Country Tax Lead at Shell)
Sebastiaan de Buck (Vice President Tax Unilever)
Hans Rijsbergen (Strategy Advisor Large Business at Dutch Tax Authorities).
Required preparation by students: not applicable
Assessment method
Examination form(s)
- Written exam (100%).
The grade for this course is based on a final written exam at the end of the course. However, depending on the number of students, we may opt for an oral instead of a written exam.
Retakes are possible for students who do not pass the exam. The retake normally consists in a written exam. However, depending on the number of students, we may opt for an oral instead of a written retake.
Areas to be tested within the exam
The examination syllabus consists of the required reading (literature) for the course, the course information guide and the subjects taught in the lectures, the seminars and all other instructions which are part of the course.
Regulation retake passed exam
In this course it is possible to retake an exam that has been passed (cf. art. 4.1.8 and further of the Course and Examination Regulations) on the condition that this course is not part of the minor. Students who have passed the exam may retake the final written assessment (test) of the course if they meet certain requirements. For more information, go to the website > ‘Law’ tab > ‘Retake a passed exam’.
Reading list
Obligatory course materials
Literature:
Jérôme Monsenego, Introduction to Transfer Pricing, Wolters Kluwer, most recent edition.
Jan van de Streek, Introduction to the Taxation of Multinational Firms, 2023.
Edoardo Traversa, Maryte Somare, BEPS and Country-by-Country Reporting: a Step Closer Towards Formulary Apportionment?, RTDT, 2015, p. 175-199.
Xavier Uberson, International Exchange of Information on Rulings, Schulthess, 2016, 510-531.
Willemien Netjes, Dominik Freyer, Policy Note: Tax Transparency Is Here to Stay: an Analysis of the Public CbCR Directive, Intertax, Vol. 50(8/9), 2022, p. 612-618.
Arjan Lejour, The Role of Conduit Countries and Tax Havens in Corporate Tax Avoidance, CentER Discussion Paper Nr. 2021-014, p. 1-27
Martijn Nouwen, Inside the EU Code of Conduct Group: 20 Years of Tackling Harmful Tax Competition, IBFD Doctoral Series, Vol. 59, 2021.
Ana Dourado, The EU Blacklist of Third-Country Jurisdictions, Intertax, Vol. 46(3), 2018, p. 178-180.
Giuseppe Melis, Alessio Persiani, The EU Blacklist: a Step Forward but Still Much to Do, EC Tax Review, Vol 5, 2019, p. 253-263.
Mona Baraké, Theresa Neef, Paul-Emmanuel Chouc, Gabriel Zucman, Minimizing the Minimum Tax? The Critical Effects of Substance Carve-Outs, EU Tax Observatory, 2021.
Additional material is made available on the Brightspace page of the course.
Reader: no
Registration
Registration for courses and exams takes place via MyStudymap. If you do not have access to MyStudymap (guest students), look here (under the Law-tab) for more information on the registration procedure in your situation.
Contact
Coordinator: dr. M.F. Nouwen
Work address: KOG, Steenschuur 25, (notify the secretariat B2.11)
Contact information: via the Institute below
Telephone number: via the Institute below
Email: m.f.nouwen@law.leidenuniv.nl
Institution/division
Institute: Institute of Tax Law and Economics
Department: Tax Law
Room number secretary: B2.11
Opening hours: 9.00 – 17.00 hrs
Telephone number secretary: +31 (0) 71 527 7840
Email: Belastingrecht@law.leidenuniv.nl