TYPES OF TAX BEHAVIOR AND THEIR DISTINCTIVE FEATURES AS A CRITERION FOR THE ADMISSIBILITY OF THE APPLICATION OF THE MUTUAL AGREEMENT PROCEDURE IN THE FRAMEWORK OF TAX CONVENTIONS

Abstract

. In the article the author examines the types of tax behavior and their peculiarities as the main criterion of admissibility of application of international legal mechanisms of settlement of international tax disputes, in particular, the Mutual Agreement Procedure. The Mutual Agreement Procedure (MAP) is a key inter-agency administrative procedure provided for in all tax treaties (conventions) on the avoidance of double taxation (DTA). Before initiating a MAP or applying other provisions of a DTA, the competent authorities must determine what type of tax behavior has occurred in a particular legal situation. Based on the analysis of international and national tax legislation, as well as practices regulating issues related to lawful and unlawful behavior of a taxpayer in the implementation of tax planning of its financial and economic activities, the author analyzed the legal categories denoting types of acceptable and unacceptable tax behavior of taxpayers ("tax evasion", "tax avoidance", "tax mitigation", "tax planning"), highlighted the peculiarities of each type of tax behavior and identified their similarities and differences. In the course of the study, the author has identified the absence in international and national tax law of unified criteria for understanding acceptable and unacceptable tax behavior. Furthermore, the author has substantiated the expediency of fixing in the DTA and in the tax legislation of states the relevant unified criteria for understanding the types of tax behavior in terms of admissibility of application of MAP or other provisions of the DTA to them. This will facilitate the resolution of the issue of legal uncertainty in the determination of the types of tax behavior and markedly enhance the efficacy of the tax collection mechanism.