Harmful Tax Competition in the East African Community

Book Overview

Focusing on Rwanda, this book explores the issue of harmful tax competition within the legal frameworks and laws of the East African Community, drawing parallels with strategies employed by the EU and OECD.

Key Themes and Topics

This book delves into the issue of harmful tax competition within the East African Community (EAC) with reference to EU and OECD approaches. With a particular focus on Rwanda, a country that has been scrutinized for its tax competition practices, it evaluates whether Rwanda’s tax competition practices are within the parameters of globally accepted practices. The analysis examines Rwanda’s favorable tax measures through the lens of its tax code, comparing it to EAC law, complemented by EU and OECD standards on harmful tax competition.

As one of the first legal studies tackling harmful tax competition in the EAC comprehensively, this book not only offers insights into the current state of harmful tax competition regulation in the EAC but also lays a groundwork for further research and policy reforms on harmful tax competition in the EAC at national and regional levels.

Moreover, it demonstrates the applicability of EU and OECD standards in jurisdictions beyond their realms, especially in developing countries, to foster tax systems that are free from harmful tax competition and to fill the gap in developing countries that do not have sufficient legal foundations to curb harmful tax competition. However, this book also highlights the limitations of EU and OECD standards to eliminate all harmful tax practices in both developed and developing countries.

This book warns EAC Partner States that they can be included or removed at any time by the OECD or the EU Code of Conduct Group, with potential economic and political repercussions. Furthermore, it advises developing countries to consider the implications of multilateral solutions and navigate the different interests between developed countries (capital exporters/residence jurisdictions) and developing countries (capital importers/source jurisdictions) in international taxation matters.

This book is a valuable resource for academics, policymakers, tax practitioners, NGOs, and individuals interested in the dynamics of harmful tax competition, particularly from the perspective of developing nations.