Exploiting Form in Avoidance by International Tax Arbitrage – Arguments Towards a Unifying Hypothesis of Taxation Law

This article, which is based on the inaugral address given at the IBFD Tax Lecture Series in Beijing, China, examines the basic foundations and nature of income tax law before going on to offer a unifying theory of taxation law. Income tax law is notoriously complex for a range of reasons. One is that tax law must address a huge and never-ending range of business transactions and structures. Another is that governments adulterate tax systems by using them to promote or to manage all sorts of economic and social programmes from mineral exploitation to birth control. Often we cannot tell whether a particular complexity is inherent in tax law or results from exogenous causes. The result is that we fail to see the fundamental causes of the complexity of tax law. The author’s hypothesis is that since about 1960 there has been a steady move in countries’ appoach to tax law from normative to factual analysis. Often, this change reflects a move from form to substance