[...]... provide insights into the weights of the respective tax drivers and how they explain the cross-territory differences in the effective average tax burdens Chapter 3 The Effective Tax Burden on Domestic and Cross-Border Investments in the Asia-Pacific Region 3.1 Methodology and Assumptions The intention of the quantitative analysis is to reveal the incentives of the tax systems in the Asia-Pacific region, India,. .. personal income tax of the individual shareholder, three main categories can be D Endres et al (eds.), Company Taxation in the Asia-Pacific Region, India, and Russia, DOI 10.1007/978-3-642-12217-0_2, # Springer‐Verlag Berlin Heidelberg 2010 3 4 2 Company Taxation Regimes in the Asia-Pacific Region, India, and Russia System of Corporate Income Taxation Classical System Double Taxation Reducing Systems Corporate... derived from the investment in the Asia-Pacific region, India, and Russia may be taxed at three different levels: In the first place, the earnings of the investment are taxed at the level of the subsidiary Secondly, the parent might face an additional tax burden when profits are repatriated The individual shareholders of the parent company represent the third potential level of taxation In the following analysis,... equals the total interest income plus 50% of non-interest income of the year On the Philippines, the amount of deductible interest expenses is reduced by 42% of the company s taxable interest income In Russia and Taiwan, interest expenses are only deductible if the interest rates do not exceed predefined thresholds In Russia the threshold is based on similar loans In Taiwan, the threshold is set by the ministry... profitable investments, the EATR constitutes the relevant measure in the context of this study.2 When computing the EATR, the most important regulations of the tax regimes in the Asia-Pacific region, India, and Russia are accounted for Besides the regulations which determine the local tax burden borne in the potential locations of the subsidiary, territory 1 Since it is described in detail in the 2001... (Germany) and the perspective of a multinational investor located in a country that applies the tax credit method (the United States) The shareholders of the parent corporations are private portfolio investors residing in the same country as the parent The investment of the parent company takes place in a subsidiary located in the Asia-Pacific region, India or Russia As subsidiary, the model assumes a company. .. effects The effective rate accounts for the deductibility of real estate tax from corporate income tax b 14 2 Company Taxation Regimes in the Asia-Pacific Region, India, and Russia tax is levied on real estate and industrial machinery at an effective rate of 2.4% It is not deductible from corporate income tax 2.6 Conclusion A comparison of the company tax regimes in the Asia-Pacific region, India, and Russia. .. report of the European Commission, it is not explained in detail here 2 The EMTR, in contrast, provides insights in the allocation efficiency of tax regimes D Endres et al (eds.), Company Taxation in the Asia-Pacific Region, India, and Russia, DOI 10.1007/978-3-642-12217-0_3, # Springer‐Verlag Berlin Heidelberg 2010 15 16 3 The Effective Tax Burden on Domestic and Cross-Border Investments in the Asia-Pacific. .. is levied in China, India, Indonesia, Japan, Singapore, South Korea, Taiwan, and Thailand The taxable value is derived either from the market value, a standardised value or from the rental value The effective tax rates range from an almost negligible 0.1% in Indonesia to a more substantial 1% in Thailand and 1.6% in India Japan, the Philippines, and Russia levy a property tax on fixed assets In contrast... Singapore taxes income based on the concepts of territoriality and receipt With respect to the integration of the corporation income tax into the personal income tax of the individual shareholders, about half the territories operate a classical system Referring to the rate structure, the applicable nominal corporation tax rates vary considerably within the Asia-Pacific region, India, and Russia The lowest . alt="" Company Taxation in the Asia-Pacific Region, India, and Russia Dieter Endres l Clemens Fuest l Christoph Spengel Editors Company Taxation in the Asia-Pacific Region, India, and Russia in collaboration. the Asia-Pacific Region, India, and Russia (Chap. 2) A comparison of the company tax regimes in the Asia-Pacific region, India, and Russia reveals differences in the tax system, the types of taxes. 10.3% and highest in Japan with 42.1%. Therefore the spread between the lowest and the highest taxed territory in terms of EATR is 31.8% points and the average EATR of the Asia-Pacific region, India,