Tarptautinis apmokestinimas ir sandorių kainodara - projekto ataskaita

Užduotis

1. How is the concept of source defined under the Lithuanian domestic tax law? How does it differ from the approaches used in other countries?
2. Explain the ways the non-resident may be taxed in Lithuania - e.g. withholding tax vs. taxation of permanent establishment? What are the differences and similarities in respect of tax base and what are the tax rates?

Company ABC is resident in State A. It has for some time been selling machine tools in State B through an agent. Company ABC has recently been making so many sales of machine tools in State B that the agent now earns 80% of its revenues from Company ABC. Company ABC believes that its sales in State B will to continue to expand and is looking for the most commercially advantageous way of building up its customer base in that country. The finance director of Company ABC is concerned about the risk of exposure to tax in State B. The options being considered are set out below. The effective tax rate in State B is considerably higher than that in Company ABC’s home state, State A. There is a Double Tax Treaty in a form identical to the OECD Model in place between States A and B.