Page 26 - Strategic Tax Planning for Global Commerce & Investment

Cross Border Tax Planning Strategies

Moving beyond transfer pricing, the most common techniques
for profit migration are financing and leveraging strategies. If
supported by company's current and future operational model,
more substantive profit migration strategies may be utilized,
thereby potentially reducing the overall tax burden of the
company and ETR on a more sustainable basis.

2. Tax and Attribute Management

Tax and attribute management involves taking advantage of
jurisdictional or in-country planning opportunities and often
entails planning related to the creation of tax attributes and/or
utilization of existing tax attributes such as tax credits, loss
carry-backs and carry-forwards, basis step-ups and re-
evaluations. In many cases, tax attributes represent deferred tax
assets for financial reporting purposes.

An integrated global tax plan should seek to take advantage of
in-country tax planning opportunities and opportunities to
monetize a company's tax attributes or use such attributes to
eliminate or mitigate taxes.

3. Treasury Management

Treasury management relates to treasury efficiency. It involves
efficient offshore cash management/cash pooling, management
of foreign exchange risks, and efficient redeployment of
offshore cash for use offshore and efficient redeployment of
offshore cash for use onshore (repatriation of cash). Treasury
management is often essential to sustain a long term reduction
in ETR. In fact, the migration of profits to lower-tax
jurisdictions or reductions of tax through in-country tax
planning is ineffective at reducing a company's ETR if the

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