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Dec 23
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THE ROLE OF CORRESPONDING ADJUSTMENT IN INTERNATIONAL AND IN SERBIAN TAX LAW

Maša Ilić

10.55836/PiP_24406A
ABSTRACT /

The role of corresponding adjustment in international tax law is to eliminate economic double taxation, so the aim of the research is to identify its regulation in international and in Serbian law, as well as to propose solutions to identified issues. A comparative method was used to analyze international regulations (OECD and UN Model conventions, EU regulation, BEPS initiative), with a focus on application issues and its relationship with current changes. Special attention was given to the relationship between corresponding adjustment and the Income Inclusion Rule contained in Pillar Two. The position of Serbia was also reconsidered, considering foreign direct investments in the context of applying the corresponding adjustment clause in tax treaties, concluding its favorable position, as well as an assessment of Serbian legislation in relation to Pillar Two, where proposal was made to focus on implementing Qualified Domestic Minimum Top-up Tax. The results highlighted disadvantages in the adopted solutions, especially in the mutual agreement procedure, and in the recently adopted solutions, for which there is no consensus in the literature.

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