Does More Sophisticated Mean Better? A Critique of Alternative Approaches to Sourcing the Interest Expense of American Multinationals

83 Pages Posted: 6 Feb 2001

See all articles by Daniel Shaviro

Daniel Shaviro

New York University School of Law

Date Written: December 2000

Abstract

This article discusses, from an economic perspective but with considerable legal detail, the United States income tax rules for "sourcing" deductions for interest expense incurred by American multinationals. Among other points, it shows that the "fungibility" standard for interest allocation that has been unquestioned for several decades lacks any persuasive normative foundation.

JEL Classification: H20, H21, H25

Suggested Citation

Shaviro, Daniel, Does More Sophisticated Mean Better? A Critique of Alternative Approaches to Sourcing the Interest Expense of American Multinationals (December 2000). Available at SSRN: https://ssrn.com/abstract=255579 or http://dx.doi.org/10.2139/ssrn.255579

Daniel Shaviro (Contact Author)

New York University School of Law ( email )

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