Institutional Development in the Avoidance of Double Non-Taxation

Abstract

In the previous chapter, institutional choice in double tax avoidance was analysed. In this chapter, I broaden the perspective to include double nontaxation. I first briefly summarize the major developments in the fight against double non-taxation and show that they can be characterized as indirect and implicit changes in the international tax regime. Then I show that the observed reforms are a response to the functional requirements of an asymmetric prisoner’s dilemma. Then I try to make sense of the particular institutional trajectory by exploring the linkage and the temporal sequence between the problems of double taxation and double non-taxation. I argue that the tax regime is subject to reinforcing and undermining processes that can explain the particular mode of institutional change.