Compliance with the OECD Model Tax Convention: An Analysis of OECD and Non-Member Countries

11 Pages Posted: 23 Dec 2022 Last revised: 10 Nov 2023

See all articles by Markus Diller

Markus Diller

University of Passau

Daniel Ehm

Passau University

Patrick Katzlmayr

University of Passau

Johannes Lorenz

Carl von Ossietzky University of Oldenburg; TRR 266 Accounting for Transparency

Date Written: December 12, 2022

Abstract

We investigate whether OECD countries are more likely to comply with the 2017 OECD Model Tax Convention on Income and on Capital (Model Convention) than are non-OECD members when designing bilateral Double Taxation Agreements (DTAs). Using Natural Language Processing (NLP) techniques, we construct vector representations for 2,925 DTAs currently in force to measure their similarity to the OECD Model Convention. We find that treaties where both parties are OECD members are less likely to resemble the OECD Model Convention than treaties between non-OECD members. Overall, our study suggests that it is essential to take the textual design of DTAs into account when the influential factors behind bargaining positions and intentions in international tax policymaking are examined.

Keywords: double taxation agreement, international tax policy, OECD, tax competition

JEL Classification: K33, K34, F55

Suggested Citation

Diller, Markus and Ehm, Daniel and Katzlmayr, Patrick and Lorenz, Johannes, Compliance with the OECD Model Tax Convention: An Analysis of OECD and Non-Member Countries (December 12, 2022). Available at SSRN: https://ssrn.com/abstract=4300375 or http://dx.doi.org/10.2139/ssrn.4300375

Markus Diller

University of Passau ( email )

Innstrasse 27
Passau, 94032
Germany

Daniel Ehm (Contact Author)

Passau University ( email )

Patrick Katzlmayr

University of Passau ( email )

Innstrasse 27
Passau, 94032
Germany

Johannes Lorenz

Carl von Ossietzky University of Oldenburg ( email )

Ammerländer Heerstraße 114-118
Oldenburg, 26129
Germany

TRR 266 Accounting for Transparency ( email )

Warburger Straße 100
Paderborn, 33098
Germany

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