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Who Invented the Single Tax Principle? An Essay on the History of US Treaty Policy

9 Pages Posted: 1 Mar 2013 Last revised: 4 Feb 2014

Reuven S. Avi-Yonah

University of Michigan Law School

Date Written: January 28, 2014

Abstract

The first US tax treaty with France in 1932 reduced US withholding taxes at a time when France was a purely territorial jurisdiction, which meant that US source income would be taxed neither by the US nor by France. Current US and OECD treaty policy, on the other hand, is to prevent such double non-taxation by conditioning the reduction of source based taxation on the income being taxed in the state of residence. This paper traces how the “single tax principle” (income should be taxed not more or less than once) made its way into the tax treaties and became a foundational element of the international tax regime.

Keywords: Tax Treaties, Limitation on Benefits, Tax History

JEL Classification: H20

Suggested Citation

Avi-Yonah, Reuven S., Who Invented the Single Tax Principle? An Essay on the History of US Treaty Policy (January 28, 2014). U of Michigan Public Law Research Paper No. 318. Available at SSRN: https://ssrn.com/abstract=2226309 or http://dx.doi.org/10.2139/ssrn.2226309

Reuven S. Avi-Yonah (Contact Author)

University of Michigan Law School ( email )

625 South State Street
Ann Arbor, MI 48109-1215
United States
734-647-4033 (Phone)

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