It has been long assumed that multinational taxpayers tend to shift profits to relatively low tax rate jurisdictions, for the purpose of reducing their global overall tax burden. Recently, research additionally shows the opposite: multinational taxpayers may shift profits to relatively high tax rate jurisdictions where there are loss-making affiliates. The proposed Common Consolidated Corporate Tax Base (CCCTB) system in the EU also provides the same opportunity of such »Shifting-To-Losses«strategy. This paper explains how the same scenarios can take place under the proposed CCCTB and suggests a practi- cal solution: to adopt an annual quantitative restriction to the losses that could be offset every tax year.

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Keywords Common Consolidated Corporate Tax Base (CCCTB), losses, Base, Erosion and Profit Shifting (BEPS), un-harmonized tax rate, European, Union, tax planning
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Journal UCPH Fiscal Relations Law Journal (FIRE Journal)
Note The original idea of this paper has been submitted to European Commission’s public consultation procedure of the re-launch of the CCCTB between 08.10.2015 to 08.01.2016
Chen, S.-C. (2019). The Strategy of Shifting-To-Losses. UCPH Fiscal Relations Law Journal (FIRE Journal), 2(1). Retrieved from