초록 열기/닫기 버튼
Unlike foreign corporations and residents, domestic corporations and residents should pay taxes on worldwide incomes. Accordingly, a domestic corporation or resident should pay taxes not only to the source country but to the residence country, which causes international double taxation. Many countries have prevented international regulations, enacting unilateral regulations in their own domestic laws or modifying their domestic laws to meet tax treaties or implementing bilateral regulations against such treaties. The domestic law does not apply unilateral allocation to the concurrences of habitability and income sources. With respect to the concurrences of taxations in a residence country and a source country, however, the foreign tax paid is deducted or the deductible amount is included in a residence country that makes it a rule to levy taxes against worldwide incomes. Also, the foreign tax paid can be exempted to prevent double taxation. The tax treaty allocates taxes to dual residents who fall under the case of habitational concurrence, but as regards the concurrence of income sources, the allocation is based on related regulations. For the concurrence of taxations in a residence country and a source country, taxes are not levied against foreign profits or foreign taxes are deducted to prevent double taxation. Contemporary business is focused on international trade rather than on home trade, unlike in the past. As the case stands, the business is greatly affected by the problem of double taxation in a source country and a residence country. Meanwhile, in late 2013, the local income tax has been regarded as an independent tax, not a surtax, whereupon it has been impossible to impose foreign tax credit (FTX) in the case of corporations. In result, corporations have suffered under disadvantages compared to individuals. Specifically, the local income tax regarded as a surtax is converted into an independent tax from 2014, and thus there has been the need to enact a separate regulation regarding the FTX system, but the problem is that ‘Restriction of Special Local Taxation Act’ applies the FTX system to the local income taxes of individuals but does not apply it to those of corporations. However, it is problematic to rationalize the enactment of such laws in every term; scilicet, there is no logical reason for the exclusion of the FTX system from the local income taxes of corporations differently than those of individuals, and moreover, it may be advisable to regulate the FTX system through the local tax act but ‘Restriction of Special Local Taxation Act.’In common with other laws, the tax law needs to be enacted in accordance with common sense, which may produce the most desirable results. Also in this regard, it may be unjustified to exclude the FTX system from the local income taxes of corporations. In conclusion, there are many problems in FTX is dealt with by ‘Restriction of Special Local Taxation Act’, which can be regarded as fallacious enactment. Thus, it is recommended that FTX should be included in the local income tax, as well as that legislation should be implemented that FTX can be applied to the local income taxes of corporations over the short haul.
키워드열기/닫기 버튼
Local Income Tax, Foreign Tax Credit, Residence Country, Double Taxation, Restriction of Special Local Taxation Act, Local Tax Act
