OECD BEPS Action 2와 연계 규정(linking rule) ―혼성단체(hybrid entity)에 관한 국내 세법의 입법론―

Hybrid entities can cause double taxation, but at the same time they can also be used as tools for tax arbitrage. “Tax arbitrage" refers to transactions that make use of different or conflicting tax laws between two countries in order to result in double non-taxation. Tax arbitrage using hybrid entities can be distinguished into “Deduction/No Inclusion (D/NI)" types and “Deduction/ Deduction (D/D)" types. Recently, the OECD has advised OECD member states and G20 countries to counter these cases of tax arbitrage by taking legislative action. The legislative means recommended by the OECD is the so-called linking rule. The linking rule is a tax provision that links one country’s tax treatment to the tax treatment in the other country. In essence, the OECD’s linking rule suggests that in cases of the aforementioned D/NI type and D/D type tax arbitrage, domestic reverse hybrid entities should be prohibited from making deductions. The OECD further has recommended that use of the linking rule should be limited to transactions among related parties or to structured arrangements. A look at legislative trends in other countries reveals that some countries have already adopted the linking rule prior to the OECD’s recommendation. For instance, Denmark has enacted legislation to respond to use of hybrid entities for tax arbitrage in transactions among related parties. The U.K. also has adopted provisions prohibiting U.K. corporate entities from making deductions in order to prevent tax arbitrage through hybrid entities. After the OECD’s BEPS Project, Mexico and the United States have newly enacted provisions in its tax laws that are similar to the linking rule proposed by the OECD. Should Korea intend to prevent tax arbitrage through hybrid entities by prohibiting deduction by domestic reverse hybrid entities, it will be necessary to enact a linking rule provision which sets out the specific requirements and legal effects. First, legislation against such tax arbitrage should indeed include the other country’s tax treatment as a criterion. Second, the problem in tax arbitrages through hybrid entities lies in the double deduction of costs, which makes denial of costs deductions by domestic reverse hybrid entities an appropriate measure. Lastly, while the scope of the new legislated provision should be limited to related parties, if structured arrangements are to be included in such scope, a clear definition of the scope of structured arrangements must be given so as to grant taxpayers sufficient predictability.