The taxation of multinational banks : alternative apportionment through a unitary taxation regime aligning with economic reality

The taxation of multinational banks currently is governed by the general principles of international tax. However, it is arguable that there are characteristics exclusive to multinational banks that may warrant the consideration of a separate taxing regime. This article argues that because of the unique nature of multinational banks, the traditional international tax rules governing jurisdiction to tax and allocation of income do not produce a result which is optimal, as it does not reflect economic reality. That is, the current system does not produce a result that accurately reflects the economic source of the income or the location of the economic activity. The suggested alternative is unitary taxation using global formulary apportionment. Formulary apportionment is considered as an alternative that reflects economic reality by recognising the unique nature of multinational banks and allocating the income to the location of the economic activity. The unique nature of multinational banking is recognised in the fact that formulary apportionment does not attempt to undertake a transactional division of a highly integrated multinational entity. Rather, it allocates income to the jurisdictions based on an economically justifiable formula. Starting from this recognition, the purpose of this article is to demonstrate that formulary apportionment is a theoretically superior (or optimal) model for the taxation of multinational banks. An optimal regime, for the purposes of this article, is considered to be one that distributes the taxing rights in an equitable manner between the relevant jurisdictions, while, simultaneously allowing decisions of the international banks to be tax neutral. In this sense, neutrality is viewed as an economic concept and equity is regarded as a legal concept. A neutral tax system is one in which tax rules do not affect economic choices about commercial activities. Neutrality will ideally be across jurisdictions as well as across traditional and non-traditional industries. The primary focus of this article is jurisdictional neutrality. A system that distributes taxing rights in an equitable manner between the relevant jurisdictions ensures that each country receives its fair share of tax revenue. Given the increase in multinational banking, jurisdictions should be concerned that they are receiving their fair share. Inter-nation equity is concerned with re-determining the proper division of the tax base among countries. Richard and Peggy Musgrave argue that sharing of the tax base by countries of source should be seen as a matter of inter-nation equity requiring international cooperation. The rights of the jurisdiction of residency will also be at issue. To this extent, while it is agreed that inter-nation equity is an essential attribute to an international tax regime, there is no universal agreement as to how to achieve it. The current system attempts to achieve such equity through a combined residency and source regime, with the transfer pricing rules used to apportion income between the relevant jurisdictions. However, this article suggests, that as an alternative to the current regime, equity would be achieved through formulary apportionment. Opposition to formulary apportionment is generally based on the argument that it is not a theoretically superior (or optimal) model because of the implementation difficulties. Yet these are two separate issues. As such, this article is divided into two core parts. The first part examines the theoretical soundness of the formulary apportionment model concluding that it is theoretically superior to the arm’s length pricing requirement of the traditional transfer pricing regime. The second part examines the practical implications of accepting formulary apportionment as an optimal model with a view to disclosing the issues that arise when a formulary apportionment regime is adopted. Prior to an analysis of the theoretical and practical application of formulary apportionment to multinational banks, the unique nature of these banks is considered. The article concludes that, while there are significant implementation, compliance, and enforcement issues to overcome, the unitary taxation model may be theoretically superior to the current arm’s length model which applies to multinational banks. This conclusion is based on the unitary taxation model providing greater alignment with the unique features of these banks.

Taxation of multinational banks : using formulary apportionment to reflect economic reality (Part 2)

As stated in Part 1 of this article, formulary appointment does not attempt to undertake a transactional division of a highly integrated multinational entity; rather, it allocates income to the jurisdictions based on economically justifiable formula. This article argues that the unitary taxation model is superior to the current arms-lenght model for the taxation of multinational banks despite significant implementation, complicance and enforcement issues. Part one of the article gave some background on the taxation of multinational banks, followed by a discussion of their uniqueness, and the theoretical benefits of the unitary tax model for multinational banking. Part 2 below covers the practical implications of accepting formulary apportionment as an 'optimal' regime for taxing multinational banks.

Economic fluctuations and productivity in the Malaysian construction sector

Growth in productivity is the key determinant of the long-term health and prosperity of an economy. The construction industry being one of major strategic importance, its productivity performance has a significant effect on national economic growth. The relationship between construction output and economy has received intensive studies, but there is lack of empirical study on the relationship between construction productivity and economic fluctuations. Fluctuations in construction output are endemic in the industry. In part they are caused by the boom and slump of the economy as a whole and in part by the nature of the construction product. This research aims to uncover how the productivity of construction sector is influenced in the course of economic fluctuations in Malaysia. Malaysia has adopted three economic policies – New Economic Policy (1971-1990), National Development Policy (1991-2000) and the National Vision Policy (2001-2010) since gaining independence in 1959. The Privatisation Master Plan was introduced in 1991. Operating within this historical context, the Malaysian construction sector has experienced four business cycles since 1960. A mixed-method design approach is adopted in this study. Quantitative analysis was conducted on the published official statistics of the construction industry and the overall economy in Malaysia between 1970 and 2009. Qualitative study involved interviews with a purposive sample of 21 industrial participants. This study identified a 32-year long building cycle appears in 1975-2006. It is superimposed with three shorter construction business cycles in 1975-1987, 1987-1999 and 1999-2006. The correlations of Construction labour productivity (CLP) and GDP per capita are statistically significant for the 1975-2006 building cycle, 1987-1999 and 1999-2006 construction business cycles. It was not significant in 1975-1987 construction business cycles. The Construction Industry Surveys/Census over the period from 1996 to 2007 show that the average growth rate of total output per employee expanded but the added value per employee contracted which imply high cost of bought-in materials and services and inefficient usage of purchases. The construction labour productivity is peaked at 2004 although there is contraction of construction sector in 2004. The residential subsector performed relatively better than the other sub-sectors in most of the productivity indicators. Improvements are found in output per employee, value added per employee, labour competitiveness and capital investment but declines are recorded in value added content and capital productivity. The civil engineering construction is most productive in the labour productivity nevertheless relatively poorer in the capital productivity. The labour cost is more competitive in the larger size establishment. The added value per labour cost is higher in larger sized establishment attributed to efficient in utilization of capital. The interview with the industrial participant reveals that the productivity of the construction sector is influenced by the economic environment, the construction methods, contract arrangement, payment chain and regulatory policies. The fluctuations of construction demand have caused companies switched to defensive strategy during the economic downturn and to ensure short-term survival than to make a profit for the long-term survival and growth. It leads the company to take drastic measures to curb expenses, downsizing, employ contract employment, diversification and venture overseas market. There is no empirical evidence supports downsizing as a necessary step in a process of reviving productivity. The productivity does not correlate with size of firm. A relatively smaller and focused firm is more productive than the larger and diversified organisation. However diversified company experienced less fluctuation in both labour and capital productivity. In order to improve the productivity of the construction sector, it is necessary to remove the negatives and flaws from past practices. The recommended measures include long-term strategic planning and coordinated approaches of government agencies in planning of infrastructure development and to provide regulatory environments which encourage competition and facilitate productivity improvement.

Putting paid to prescribed roles : a new era for Australian women and philanthropy

In redefining our understanding of women’s roles in contemporary Australian philanthropy, the impact of major contextual and demographic changes, as well as changes in women’s roles, responsibilities and opportunities need to be considered. Although academic study of philanthropy and the wider third sector is increasing in Australia, literature searches have revealed little current data on the giving patterns and philanthropic drivers for contemporary Australian women, particularly emerging cohorts (one ABS survey looks at giving patterns – ABS, 2000b: 32). In contrast, there is increasing interest in the US, where it is acknowledged that more women are becoming independent holders of wealth; and that interested donors have specific needs, desires and motivations in terms of knowledge, power, marketing and response to their philanthropy (see for example, Grace 2000; McCarthy 2001; Women’s Philanthropy Institute 2002). These varied demographic, social and economic drivers, which could also be expected to encourage new cohorts of Australian women to give, will be examined within our definition of women in philanthropy, and a brief history of women’s philanthropy in Australia, in order to inform future in-depth analyses of Australian women donors.

Alternative primary sources for studying Australian television history : an annotated list of online private collections

It is possible to write many different histories of Australian television, and these different histories draw on different primary sources. The ABC of Drama, for example, draws on the ABC Document Archives (Jacka 1991). Most of the information for Images and Industry: television drama production in Australia is taken from original interviews with television production staff (Moran 1985). Ending the Affair, as well as archival work, draws on ‘over ten years of watching … Australian television current affairs’ (Turner 2005, xiii). Moran’s Guide to Australian TV Series draws exhaustively on extant archives: the ABC Document Archives, material sourced through the ABC Drama department, the Australian Film Commission, the library of the Australian Film, Television and Radio School, and the Australian Film Institute (Moran 1993, xi)...

Documentary as history, memory, dream and film

A century ago, as the Western world embarked on a period of traumatic change, the visual realism of photography and documentary film brought print and radio news to life. The vision that these new mediums threw into stark relief was one of intense social and political upheaval: the birth of modernity fired and tempered in the crucible of the Great War. As millions died in this fiery chamber and the influenza pandemic that followed, lines of empires staggered to their fall, and new geo-political boundaries were scored in the raw, red flesh of Europe. The decade of 1910 to 1919 also heralded a prolific period of artistic experimentation. It marked the beginning of the social and artistic age of modernity and, with it, the nascent beginnings of a new art form: film. We still live in the shadow of this violent, traumatic and fertile age; haunted by the ghosts of Flanders and Gallipoli and its ripples of innovation and creativity. Something happened here, but to understand how and why is not easy; for the documentary images we carry with us in our collective cultural memory have become what Baudrillard refers to as simulacra. Detached from their referents, they have become referents themselves, to underscore other, grand narratives in television and Hollywood films. The personal histories of the individuals they represent so graphically–and their hope, love and loss–are folded into a national story that serves, like war memorials and national holidays, to buttress social myths and values. And, as filmic images cross-pollinate, with each iteration offering a new catharsis, events that must have been terrifying or wondrous are abstracted. In this paper we first discuss this transformation through reference to theories of documentary and memory–this will form a conceptual framework for a subsequent discussion of the short film Anmer. Produced by the first author in 2010, Anmer is a visual essay on documentary, simulacra and the symbolic narratives of history. Its form, structure and aesthetic speak of the confluence of documentary, history, memory and dream. Located in the first decade of the twentieth century, its non-linear narratives of personal tragedy and poetic dreamscapes are an evocative reminder of the distance between intimate experience, grand narratives, and the mythologies of popular films. This transformation of documentary sources not only played out in the processes of the film’s production, but also came to form its theme.

History of critical criminology in Australia

Those working in the critical criminology tradition have been centrally concerned with the social construction, variability and contingency of the criminal label. The concern is no less salient to a consideration of critical criminology itself and any history of critical criminology (in Australia or elsewhere) should aim itself to be critical in this sense. The point applies with equal force to both of the terms ‘critical’ and ‘criminology’. The want of a stable theoretical object has meant that criminology itself needs to be seen not as a distinct discipline but as a composite intellectual and governmental hybrid, a field of studies that overlaps and intersects many others (sociology, law, psychology, history, anthropology, social work, media studies and youth studies to name only a few). In consequence, much of the most powerful work on subjects of criminological inquiry is undertaken by scholars who do not necessarily define themselves as criminologists first and foremost, or at all. For reasons that should later become obvious this is even more pronounced in the Australian context. Although we may appear at times to be claiming such work for criminology, our purpose is to recognize its impact on and in critical criminology in Australia.

Environmental law and the economic impact on Australian firms

In response to international awareness of environmental issues and the inadequacies of common law actions, legislation has been enacted by Australian governments to facilitate environmental protection. The Environmental Protection Act 1994 (Qld) and accompanying Environmental Protection (Interim) Regulation 1995 (Qld) is one example of government response to mounting public pressure to legislate for the environment. Investigation into the operation of the legislation exposes the costs faced by Australian firms in its application. The legislation identifies a number of environmentally relevant activities and imposes licensing and reporting requirements on firms undertaking such activities. In view of these legislative requirements and the increasing public awareness of environmental issues over the last decade in Australia, it could be expected that firms undertaking environmentally sensitive activities will place greater importance on the management of environmental issues. If so, the greater prominence placed on environmental management may be reflected in disclosures made by the firm to its shareholders and other interested parties. This article investigates the type and extent of costs currently imposed by the body of environmental laws in Australia with the discussion primarily focusing upon costs imposed due to the operation of environmental legislation in Queensland. Further, the article reports empirical analysis of management response to environmental issues where firms are undertaking environmentally sensitive activities.

The evolutionary history of the extinct ratite moa and New Zealand Neogene paleogeography

The ratite moa (Aves: Dinornithiformes) were a speciose group of massive graviportal avian herbivores that dominated the New Zealand (NZ) ecosystem until their extinction �600 years ago. The phylogeny and evolutionary history of this morphologically diverse order has remained controversial since their initial description in 1839. We synthesize mitochondrial phylogenetic information from 263 subfossil moa specimens from across NZ with morphological, ecological, and new geological data to create the first comprehensive phylogeny, taxonomy, and evolutionary timeframe for all of the species of an extinct order. We also present an important new geological/paleogeographical model of late Cenozoic NZ, which suggests that terrestrial biota on the North and South Island landmasses were isolated for most of the past 20–30 Ma. The data reveal that the patterns of genetic diversity within and between differentmoaclades reflect a complex history following a major marine transgression in the Oligocene, affected by marine barriers, tectonic activity, and glacial cycles. Surprisingly, the remarkable morphological radiation of moa appears to have occurred much more recently than previous early Miocene (ca. 15 Ma) estimates, and was coincident with the accelerated uplift of the Southern Alps just ca. 5–8.5 Ma. Together with recent fossil evidence, these data suggest that the recent evolutionary history of nearly all of the iconic NZ terrestrial biota occurred principally on just the South Island.

The evolutionary history of cockatoos (Aves: Psittaciformes: Cacatuidae)

Cockatoos are the distinctive family Cacatuidae, a major lineage of the order of parrots (Psittaciformes) and distributed throughout the Australasian region of the world. However, the evolutionary history of cockatoos is not well understood. We investigated the phylogeny of cockatoos based on three mitochondrial and three nuclear DNA genes obtained from 16 of 21 species of Cacatuidae. In addition, five novel mitochondrial genomes were used to estimate time of divergence and our estimates indicate Cacatuidae diverged from Psittacidae approximately 40.7 million years ago (95% CI 51.6–30.3 Ma) during the Eocene. Our data shows Cacatuidae began to diversify approximately 27.9 Ma (95% CI 38.1–18.3 Ma) during the Oligocene. The early to middle Miocene (20–10 Ma) was a significant period in the evolution of modern Australian environments and vegetation, in which a transformation from mainly mesic to xeric habitats (e.g., fire-adapted sclerophyll vegetation and grasslands) occurred. We hypothesize that this environmental transformation was a driving force behind the diversification of cockatoos. A detailed multi-locus molecular phylogeny enabled us to resolve the phylogenetic placements of the Palm Cockatoo (Probosciger aterrimus), Galah (Eolophus roseicapillus), Gang-gang Cockatoo (Callocephalon fimbriatum) and Cockatiel (Nymphicus hollandicus), which have historically been difficult to place within Cacatuidae. When the molecular evidence is analysed in concert with morphology, it is clear that many of the cockatoo species’ diagnostic phenotypic traits such as plumage colour, body size, wing shape and bill morphology have evolved in parallel or convergently across lineages.

A new geological model of Cenozoic New Zealand suggests a complex phylogeographic history for New Zealand terrestrial taxa

The new model of North Island Cenozoic palaeogeography developed by Kamp et al. has a range of important implications for the evolution of New Zealand terrestrial taxa over the past 30 Ma. Key aspects include the prolonged isolation of the biota on the North Island landmass from the larger and more diverse greater South Island, and the founding of North Island taxa from the potentially unusual ecosystem of a small island around Northland. The prolonged period of isolation is expected to have generated deep phylogenetic splits within taxa present on both islands, and an important current aim should be to identify such signals in surviving endemics to start building a picture of the historical phylogeography, and inferred ecology of both islands through the Cenozoic. Given the potential differences in founding terrestrial species and climatic conditions, it seems likely that the ecology may have been very diferent between the North and South Islands. New genetic data from the 10 or so species of extinct moa suggest that the radiation of moa was much more recent than previously suggested, and reveals a complex pattern that is inferred to result from the interplay of the Cenozoic biogeography, marine barriers, and glacial cycles.

A preliminary study into the environmental and economic consequences of a sugar factory depithing operation

Bagasse stockpile operations have the potential to lead to adverse environmental and social impacts. Dust releases can cause occupational health and safety concerns for factory workers and dust emissions impact on the surrounding community. Preliminary modelling showed that bagasse depithing would likely reduce the environmental risks, particularly dust emissions, associated with large scale bagasse stockpiling operations. Dust emission properties were measured and used for dispersion modelling with favourable outcomes. Modelling showed a 70% reduction in peak ground level concentrations of PM10 dust (particles with an aerodynamic diameter less than 10 µm) from operations on depithed bagasse stockpiles compared to similar operations on stockpiles of whole bagasse. However, the costs of a depithing operation at a sugar factory were estimated to be approximately $2.1 million in capital expenditure to process 100,000 t/y of bagasse and operating costs were approximately $200,000 p.a. The total capital cost for a 10,000 t/y operation was approximately $1.6 million. The cost of depithing based on a discounted cash flow analysis was $5.50 per tonne of bagasse for the 100,000 t/y scenario. This may make depithing prohibitively expensive in many situations if installed exclusively as a dust control measure.

Artful interviewing: Conducting oral history interviews for practice-led research

Recently, there has been an increased use of oral history as source material and inspiration for creative products, such as new media productions; visual art; theatre and fiction. The rise of the digital story in museum and library settings reflects a new emphasis on publishing oral histories in forms that are accessible and speak to diverse audiences. Visual artists are embracing oral history as a source of emotional, experiential and thematic authenticity (Anderson 2009 and Brown 2009). Rosemary Neill (2010) observes the rise of documentary and verbatim theatre — where the words of real people are reproduced on-stage — in Australia. Authors such as Dave Eggers (2006), M. J. Hyland (2009), Padma Viswanathan (2008) and Terry Whitebeach (2002) all acknowledge that interviews heavily inform their works of fiction. In such contexts, oral histories are not valued so much for their factual content but as sources that are at once dynamic, evolving, emotionally authentic and ambiguous. How can practice-led researchers design interviews that reflect this emphasis? In this paper, I will discuss how I developed an interview methodology for my own practice-led research project, The Artful Life Story: Oral History and Fiction. In my practice, I draw on oral histories to inform a work of fiction. I developed a methodology for eliciting sensory details and stories around place and the urban environment. I will also read an extract from ‘Evelyn on the Verandah,’ a short story based on an oral history interview with a 21 year-old woman who grew up in New Farm, which will be published in the One Book Many Brisbanes short story anthology in June this year (2010).

Hearing voice and silence during stressful economic times

Purpose - It is ironic that in stressful economic times, when new ideas and positive behaviors could be most valuable, employees may not speak up, leading to reduced employee participation, less organizational learning, less innovation and less receptiveness to change. The supervisor is the organization’s first line of defense against a culture of silence and towards a culture of openness. This research asks what helps supervisors to hear prosocial voice and notice defensive silence. Design/methodology/approach - We conducted a cross-sectional field study of 142 supervisors. Findings - Our results indicate that prosocial voice is increased by supervisor tension and trust in employees, while defensive silence is increased by supervisor tension but reduced by unionization of employees and trust in employees. This indicates that, as hypothesized by others, voice and silence are orthogonal and not opposites of the same construct. Research limitations/implications - The data is measured at one point in time, and further longitudinal study would be helpful to further understand the phenomena. Practical implications - This research highlights the potential for supervisors in stressful situations to selectively hear voice and silence from employees. Originality/value - This study adds to our knowledge of prosocial voice and defensive silence by testing supervisors’ perceptions of these constructs during difficult times. It provides valuable empirical insights to a literature dominated by conceptual non-empirical papers. Limited research on silence might reflect how difficult it is to study such an ambiguous and passive construct as silence (often simply viewed as a lack of speech). also contribute to trust literature by identifying its role in increasing supervisor’s perceptions of prosocial voice and reducing perceptions of defensive silence.