FIRST, economic essence. After BEPS plan has been implemented by various countries, the number of conduit companies with no economic essence will be reduced and more source countries will refuse to offer collective preference to the countries with no economic essence.
SECOND, transparency. On the initiative of OECD, consolidated standards of reporting has been gradually implemented by various countries. Financial institutions are required to confirm their clients’ tax identities and offer deposit and some income information to the countries of their clients residence. Accounts with no real names will be reduced and subsequently diminished.
THIRD, government subsidies. The international tax code also includes EU tax guidelines. Government subsidies rules decided by EU have extraordinary impacts on international taxes. Tax breaks given by the state may be seen as illegal government subsidies, in violation of EU law, and the result may be that preferential treatment is eliminated, and the risk of tax rises and fines increases.
FOURTH, Brexit. After Brexit, England will no longer be constrained by EU indirect taxes, tariff laws and cases decided by EU courts. Therefore, Chinese enterprises should know fairly well about the influences of Brexit if their overseas investment includes investments in England.
FIFTH, American tax reform. The “border adjustment tax”, once implemented, would raise the tax burden on imports from the United States, while exports would actually be subsidized by the U.S. state. Countries such as China, which are dependent on American exports, should study the proposal to predict the consequences for China and take corresponding actions.